How low can it go?

Gas prices at the pump are falling are falling below $2 a gallon in South Florida. From the Miami Herald

Gasoline prices, in stunning free fall, broke the two-buck barrier at some South Florida stations on Thursday.

There is no need to rush out for a bargain fill-up. By the weekend, a gallon likely will be even cheaper.

Linked to the crude oil that is refined to produce it, gasoline has undergone record price plunges, faster even than the Dow Jones industrial average’s tumble. It may well keep dropping until the new year, analysts said, offering beleaguered consumers an early and unexpected holiday gift in an otherwise Scroogean economy.

”I don’t think we have ever seen a month like October when gas prices fell by five or six cents a day,” said Gregg Laskoski, a spokesman for the American Automobile Association Auto Club South, which tracks gasoline prices in Florida, Georgia, Tennessee and Puerto Rico. “It’s phenomenal.”

The average price of a gallon of regular unleaded gas in Florida has fallen a staggering 49 percent to $2.06 since an all-time high set only four months ago. In July, gas in Miami and Fort Lauderdale cost about $4.16 a gallon. On Thursday, the averages were $2.20 and $2.14 respectively.

Nationally, the drop since July has been more than half to $2.02, with 23 states now posting average regular prices below $2 a gallon.

The lowest price in my corner of Palm Beach County is $2.15 a gallon. I’m predicting I see prices under $2 by the first week in December.

Falling gas prices when taken by themselves is good economic news. It makes my visit to the gas station every 10 days or so less painful. Wizbang contributor Lorie Byrd also got her wish. The lower prices at the pump however is a symptom of the slumping worldwide economy. Demand is down because production decreases demand is down. So while consumers are taking a smaller visible hit at the gas station, they are being hit less visibly in other places and probably much more substantially.

Hat tip- SFDB

Update- Fixed my post to what I really meant. Gas prices are down because of lower demand.

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