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Will sinking gas prices fall even lower?

A story that might have slipped past you last week, especially since it took place on Thanksgiving Day, was the decision by the Organization of the Petroleum Exporting Countries (OPEC) to maintain its current levels of crude oil production despite the recent dramatic drop in oil prices.

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Soon after their meeting in Vienna, OPEC announced that its member countries "confirmed their readiness to respond to developments which could have an adverse impact on the maintenance of an orderly and balanced oil market."

One of those developments has been North America's shale oil boom, which has certainly played a role in the global drop in oil prices. It's gotten to the point where, ahead of the OPEC meeting, Saudi Arabia announced it was cutting the price of its oil for the U.S. market in an effort to stay competitive.

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But does OPEC's announcement mean American businesses and consumers should just sit back and enjoy the ride, as oil and gas prices continue their march downward?

"I just don't see any reason why they shouldn't," John Kingston, director of news at Platts, a provider of global energy, petrochemicals, metals and agriculture information, told CBS MoneyWatch.

"All the trends, I would say, are that the U.S. national retail gasoline price is certainly not at its low point."


Around the U.S. gas prices over the Thanksgiving Day weekend averaged $2.80 a gallon, 50 cents lower than a year ago and the lowest price since October of 2010, according to AAA. The transportation group said that compared with the year-ago period the average price at the pump has fallen in every state and Washington, D.C., and it expects fuel costs to continue sinking during the holidays.

Kingston says the major oil-producing nations of OPEC, like Saudi Arabia and Kuwait, decided it would be "a fool's game" for them to reduce their current oil production and give up market share just so that other OPEC members could benefit.

Some observers, meanwhile, say OPEC has no one to blame but themselves for their present circumstances.

"By ensuring that the price stayed above $100 a barrel for much of the past six or seven years, OPEC has sowed the seeds of its own destruction," Jeremy Warner, assistant editor of Britain's Daily Telegraph, recently opined.

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"Those sky-high oil prices are one of the reasons why the global economy has been struggling," he continued. "There is even quite a bit of evidence to suggest they were a key factor in tipping the world into crisis in the first place."

What's striking about OPEC's latest move, according to Kingston and other industry analysts, is that the oil cartel appears to be letting the global market decide where oil prices should go.

"This is quite unprecedented, that OPEC is not defending a price target," said Bhushan Bahree, senior director, global oil at the global information company IHS. "They feel that they have to sort out where the real price of oil should be, instead of maintaining a price which is high enough to encourage all this competitive production elsewhere."

But given the current volatility of the global market, some analysts warn consumers to stay alert for sudden swings in oil and gas prices. OPEC could decide to test the "pain point" of the U.S. shale oil industry by letting crude oil prices plummet further.

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