Motorists got some relief as gas fell 1.4 cents over the weekend to a national average of $3.095 a gallon, according to AAA and the Oil Price Information Service. Prices peaked at $3.112 a gallon last Thursday, and appear unlikely to rise the additional 10 to 15 cents many had predicted while oil appeared to marching relentlessly toward $100 a barrel.
Nationwide, gas prices had jumped 13 cents in the past two weeks, reports CBS News national correspondent Byron Pitts, as a record 31 million travelers prepare to take to the road this Thanksgiving.
Blame it on the rising price of oil, now at close to $95 a barrel.
Crude futures, meanwhile, fell Monday as traders weighed the possibility of an economic slowdown and OPEC production hikes against the potential for surprise supply declines in this week's oil inventory report or an overseas supply disruption during the long Thanksgiving holiday weekend.
"People are kind of torn as to which way the market will go this week," said Michael Lynch, president of Strategic Energy & Economic Research Inc. in Amherst, Mass.
Light, sweet crude for January delivery fell 58 cents to $93.26 a barrel on the New York Mercantile Exchange Monday after rising as high as $95.15 and alternating between gains and losses earlier. Traders were concerned about the economy, analysts said, given Goldman Sachs' downgrade on Monday of large banks and its estimate that Citigroup Inc. would have to write down $15 billion in coming quarters due to its exposure to risky debt.
Energy investors have long worried that the problems in the subprime mortgage industry would widen, hurting the general economy and reducing demand for oil and gasoline.
"The weak economy is still weighing on people's minds," Lynch said.
The possibility that the Organization of Petroleum Exporting Countries will agree at a meeting next month to increase production also depressed prices, analysts said. OPEC heads of state held a summit meeting over the weekend in Saudi Arabia but made no decision on production. Recent statements from Saudi Arabia's oil minister suggest the cartel may boost production to bring oil prices down.
Data released Friday that showed speculative buying of oil futures fell sharply last week also contributed to Monday's declines.
"After holding long positions for a long time, many traders apparently no longer are sure that crude oil prices are still in a bullish trend," wrote Peter Beutel, president of U.S. energy risk management firm Cameron Hanover, in a research note.
Countering those concerns was the possibility that the Energy Department will report Wednesday that oil inventories fell last week or that conflict will escalate in the Middle East or another oil producing nation over the Thanksgiving holiday weekend. The Nymex will be closed on Thursday and close early on Friday.
Other energy futures also fell Monday. Gasoline for December delivery fell 1.15 cents to $2.3639 a gallon, and heating oil futures fell 1.47 cents to $2.5724 a gallon. Natural gas for December fell 9.5 cents to $7.906 per 1,000 cubic feet.
In London, January Brent crude fell 56 cents to $91.06 a barrel on the ICE Futures exchange.