Gas Prices

The nation's gas stations continue to cut prices, with the average price of regular unleaded down another two cents a gallon Sunday, according to travel group AAA's daily survey.

The nationwide average price for regular unleaded fell to $2.509 a gallon from $2.529 Saturday, according to AAA. The price is down nearly 18 percent from the record high of $3.057 that it hit on Labor Day, following Hurricane Katrina.

Gasoline is down from $2.843 a month ago, but up from $2.031 a year ago, AAA says, a 24-percent year-over-year increase.

Retail diesel, which had been lagging the decline in gasoline, fell 2.8 cents to $3.11 a gallon Sunday. Diesel is down 4 percent from the record $3.239 set last Monday, but up more than 38 percent from $2.247 a year ago.

Gasoline prices have steadily fallen during the past two weeks on signs that the soaring expense of energy is finally starting to curb consumption within the U.S., the world's biggest user of fuel. In its weekly inventory report, the U.S. government reported Wednesday that demand for gasoline was two percent lower last week despite the recent decline in pump prices.

On a state-by-state basis, AAA says Hawaiians pay the most for regular unleaded at $3.01 a gallon. Oklahoma has the lowest prices, at $2.164 a gallon.

The average gallon of mid-grade gasoline fell 2.1 cents Sunday to $2.664, according to AAA. Premium unleaded fell 2.1 cents to $2.762 a gallon
What has caused the demand for gasoline to go down? Will prices continue to go down?