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Fuel price brief – gas prices expected to drop further

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OIL DIPS BELOW $100 A BARREL; GAS PRICES EXPECTED TO DROP FURTHER

Oil prices dropped below $100 to settle Friday at $99.29 a barrel on the New York Mercantile Exchange-93 cents less than last week. Prices fell after Saudi Arabia announced it will increase production quotas next month by 10 million barrels a day.

The decision was partly based on concern the high oil and gas prices are slowing the worldwide economic recovery. The increase is said to ease supply concerns and help make up for the loss of Libyan oil exports. The U.S. dollar was given a boost after the value of the euro fell, which could push oil prices lower this week.

“The fact that Saudi Arabia decided to increase output quotas is good news for consumers,” said Jessica Brady, spokesperson, AAA Auto Club South. “The increased supply should help keep oil prices below $100 a barrel and keep the downward momentum on retail gas prices. Gas prices have steadily decreased throughout the past few weeks and are expected to move even lower this week. If prices continue to drop as expected, we could see a much healthier travel outlook for Independence Day than we did during Memorial Day weekend.”

The national average price of unleaded regular gasoline is $3.70 a gallon, 7 cents less than last week. Florida’s average price of $3.63 is 5 cents less than last week, while Georgia’s average price of $3.58 and Tennessee’s average price of $3.49 both reflect a 4-cent decrease from last week, respectively.

CURRENT AND PAST PRICE AVERAGES

Regular Unleaded Gasoline

Current Week Ago Month Ago Year Ago

National: $3.708 $3.775 $3.982 $2.702

Florida: $3.633 $3.685 $3.933 $2.649

Georgia: $3.583 $3.624 $3.945 $2.547

Tennessee: $3.490 $3.530 $3.793 $2.531

AAA’s Daily Fuel Gauge Report is updated each day and reflects actual prices from credit card transactions within the past 24 hours at two-thirds (100,000) gasoline stations in the U.S. Its accuracy is unparalleled.

Next Fuel Price Brief: Sunday, June 19, 2011

Source: AAA