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OPEC Unable To Stop Gas Prices' Slide

Oil down to $54 a barrel, gas trending well below $2

December 1, 2008

The Organization of Petroleum Exporting Countries (OPEC) met in Egypt over the weekend, but was unable to devise a way to stop oil prices' downward spiral. As a result, gasoline prices paid by U.S. consumers are sharply lower, and could fall even more.

On Friday oil prices closed at $54.43 a barrel on the New York Mercantile Exchange, more than $90 lower than July's high of $147. Some analysts have suggested that the price of oil could even drop to the $30 a barrel level before the global economy begins to recover. Almost all agree that as world economies recover, rising oil demand will send gas prices back up.

In the meantime, consumers are enjoying prices not seen in nearly two years. The average of price for unleaded regular gasoline was $1.825 Sunday, as millions of Thanksgiving holiday travelers headed for home. That's down from $3.077 last year.

Missouri continues to have the cheapest gas in the nation, at $1.553 a gallon for a statewide average price. Alaska has the most expensive gas, at $2.78 a gallon.

OPEC oil ministers are feeling the shock most consumers were feeling earlier this year. Oil prices at current levels could have a crippling--even a destabilizing--effect on their economies.

Member countries have said they need prices between $60 and $90 a barrel just to balance their budgets. Saudi Arabia said it believes $75 would be "a fair price." However, most analysts say oil is unlikely to approach that level any time soon.

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