National Average Gas Price Falls Below $3 Per Gallon, AAA Says

ORLANDO, Fla.--Aug. 15, 2006--The nationwide average price of self-serve regular gasoline fell below $3 per gallon today after nearing the previous all-time record high of $3.057 set on Labor Day 2005, AAA's daily, on-line Fuel Gauge Report (http://www.aaafuelgaugereport.com) shows.

The drop in price to $2.997 per gallon is contrary to widespread projections last week that fuel prices would reach new record highs, AAA said.

Last week, the average price of gasoline reached $3.03 per gallon as British Petroleum (BP) announced they would be temporarily suspending production at a Prudhoe Bay oil field to repair a damaged pipeline. The news sent the price of oil above $76 per barrel before declining to near $73 per barrel today.

AAA said a combination of factors helped mitigate the effects of BP's announcement on the price of gasoline. These include the fact that current oil inventories are relatively healthy in the United States, the Bush administration signaled it would release oil from the Strategic Petroleum Reserve if needed, the truce between Israel and Hezbollah in Lebanon seems to be holding, and the continuation of relatively calm weather in the Caribbean.

The average price of self-serve regular was $2.96 one month ago. One year ago the price was $2.484 per gallon, AAA said.

According to AAA, Hawaii has the highest average gas price in the nation at $3.368 per gallon. California and Connecticut both have the next highest average prices; both at $3.216 per gallon. Half of the states, plus the District of Columbia, have average retail prices in excess of $3 per gallon.

South Carolina has the lowest state-wide average gasoline price in the nation at $2.822 per gallon. Mississippi and Kentucky have the next lowest prices; both at $2.885 per gallon.

Nationwide, the price of self-serve, mid-grade gasoline averages $3.182 per gallon, a decline from $3.188 per gallon in the middle of last month, and up from $2.636. Self-serve premium averages $3.297 per gallon, down from $3.304 one month ago. Premium averaged $2.733 per gallon at this time last year.

The national average prices for self-serve regular unleaded gasoline for AAA's mid-August survey for the last five years are: 2005, $2.484; 2004, $1.862; 2003, $1.566; 2002, $1.405; and 2001, $1.393.

AAA's Fuel Gauge Report is based on data from Oil Price Information Service, the nation's most comprehensive source of petroleum pricing information. AAA purchases the data and makes it available free on the Internet as a public service. Average daily prices for the nation, all 50 states and more than 250 localities are available for all grades of gasoline, making the site the most current and complete public source of fuel price information.

As the nation's largest motoring and leisure travel organization, AAA provides more than 49 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax paying AAA has been a leader and advocate for the safety and security of all travelers. AAA clubs can be visited on the Internet at http://www.aaa.com.