Gas Prices Drop 9 Cents a Gallon

July 23, 2007— -- Gas prices across the United States fell by an average of 9 cents in the last week, according to the latest government survey released Monday afternoon.

The average gallon of gas now costs $2.96, 9 cents lower than the previous week, the Energy Department reported.

Refinery problems in the Midwest that had pushed regional prices higher than California's have disappeared.

Midwesterners saw prices drop 19 cents in a single week, to $2.98 a gallon, as the problems were corrected. California is now back on top of the national gas price pile, with a gallon of regular unleaded costing $3.12.

The big one-week drop has pushed prices 1.5 percent below where they were a year ago, at $3 a gallon. That's something that hasn't happened in three months.

Comments from an OPEC official, who noted that oil prices were above the level he considered "fair value," had many traders selling futures contracts. Some believe that OPEC might actually decide to increase production at its September meeting.

The price of crude oil also dropped by 90 cents Monday in New York trading. A barrel of oil will now set you back $74.89.