For the first time in 25 years, due to a glut of oil that exists on global markets, oil demand worldwide is shrinking, and gas prices are following its lead.
According to the AAA, the retail price of gas has dropped more than a nickel this week in most areas, while prices are now in the price range last seen during early 2005.
Despite the price drop, holiday shoppers are driving less -- 100 billion miles less, according to the Department of Energy. Between November 2007 and October 2008, the U.S. has seen the largest continuous decline in American driving in history compared to the same period last year. The south Atlantic – a block of eight states and Washington, D.C. – had the biggest decline of any region.
The government predicts that gasoline demand will drop even further in 2009.
The International Energy Agency, meanwhile, reported that world oil demand for 2008 will be down from last year by several tens of thousands of barrels.
Crude prices closed the week at $46.28.
Gas prices generally track crude prices as crude oil is the single biggest component in gasoline.
CURRENT AND PAST GAS PRICE AVERAGES
Regular Unleaded Gasoline (*indicates record high)
| 12/14/08 | Week Ago | Year Ago | |
| National | $1.66 | $1.73 | $3.00 |
| Washington DC | $1.81 | $1.92 | $3.06 |
| DC Only | $1.81 | $1.91 | $3.06 |
| $1.68 | $1.77 | $3.00 | |
| Crude Oil | $46.28/barrel at close Friday | $40.81/barrel
| $93.00/barrel |
To find cheap gas prices in the D.C. area, click here.
