Watch CBSN Live

U.S. Motorists Get Break At Pump

The average U.S. retail price of gasoline fell by more than 7 cents last week to $2.92 a gallon.

The federal Energy Information Administration said U.S. motorists paid $2.924 a gallon on average for regular grade last week, a decrease of 7.6 cents from the previous week. Pump prices are 31.2 cents higher than a year ago.

Separately, Triple A also reported gasoline prices were headed down, with the national average for unleaded is just under $2.93 a gallon.

Analysts interviewed by USA Today said gas prices were likely to continue to drop in the weeks to come as the summer driving season comes to an end.

"Unless you get another Katrina-Rita (hurricane) kind of event, odds are we've probably seen the worst of it," analyst Bill O'Grady of A.G. Edwards told the newspaper.

Average retail gasoline prices peaked at $3.07 a gallon last September, reflecting the extreme tightness in the market following Hurricane Katrina, which knocked out refineries in the Gulf region as well as pipelines that deliver fuel to the East Coast and Midwest.

Gasoline prices were most expensive last week on the West Coast, averaging $3.098 per gallon, and cheapest in the Gulf Coast region, averaging $2.819 per gallon.

The main factor underpinning the high price of gasoline is the cost of crude oil, which has been elevated by strong demand and geopolitical uncertainties.

Unrest in the Mideast could push the cost of oil and gasoline costs higher despite the short-term outlook for a decline in U.S. gas prices.

Oil prices hit a record high of $78.40 a barrel on July 14, two days after fighting between Israel and Hezbollah erupted in Lebanon.

Oil traders also are also concerned about the threat of hurricanes in the Gulf of Mexico that could affect production and refining facilities.