Watch CBSN Live

Good news for drivers, as gas prices slide

Latest MoneyWatch headlines

Time to fill up your Hummers, Americans -- the average price of gasoline in the U.S. is heading back down to less than $2 a gallon.

Prices at the pump are already below that level in 15 states, with South Carolina drivers enjoying the cheapest gas at $1.81, according to AAA. Other states where prices are low: Alabama ($1.86), Tennessee ($1.89), Mississippi ($1.89), New Jersey ($1.90) and Virginia ($1.91). More than four of 10 gas stations around the nation are selling gas for less than $2 a gallon.

Falling oil prices force Alaska-based company to lay off employees

The priciest state for gas is in Hawaii, where drivers pay $2.73 a gallon. Regionally, the West Coast is the most expensive market, AAA's data show, with California ($2.73), Washington ($2.62) and Alaska ($2.59) topping the list.

Premium gas around the U.S. fetches an average of $2.67 a gallon, while diesel costs $2.35, according to the Lundberg Survey.

But wait, there's more. The Energy Information Administration expects the average price for regular unleaded gas, which is at a four-month low of $2.12, to drop below $2 nationwide by year-end.

A year ago, gas cost about $2.58 and was pushing $3.50 at this point in 2014.

Fuel costs have been volatile this year. They plummeted in January and February as oil prices headed south amid a slowdown in the global economy and a glut in crude production. But since June 3, when prices peaked, they've gone right back down as oil prices have receded and as U.S. energy companies have upped production.

The price of West Texas Intermediate oil, the U.S. benchmark, slumped last month as domestic production exceeded demand. Global factors are also weighing on oil, with Saudi Arabia, the world's biggest crude exporter, saying on Wednesday that its output in July had reached a record high.

"Combined weaker crude oil prices and a very robust, very aggressive U.S. output of gasoline were the two essential causes" of falling gas costs in recent weeks, said Trilby Lundberg, publisher of market research firm the Lundberg Survey.