Oil tumbles to lowest price since ’04

COLUMBUS, Ohio – Oil prices hit four-year lows Friday as employers cut the highest number of jobs in 34 years. The continuing decline in prices is so dramatic and so sudden that it is raising the prospect that gas prices could soon fall below $1 a gallon.

A gallon of gasoline can be had for 50 cents less than it cost last month.

Granted, gas prices are a long way off from that magic number last seen in March 1999 when prices were at 97 cents a gallon, according to motor club AAA. Prices at the pump fell 1.6 cents overnight to $1.773 nationally, according to AAA, the Oil Price Information Service and Wright Express.

But oil has fallen 72 percent in less than five months. A barrel of oil hit a record $147.27 on July 11, and a gallon of gas was $4.117 on July 17.

Just this week, in which the National Bureau of Economic Research determined that the U.S. is in recession, oil has fallen 25 percent.

On Friday, light, sweet crude for January delivery settled at $40.81 a barrel on the New York Mercantile Exchange, down by nearly $3 per barrel. Prices fell as low at $40.50, levels last seen in December 2004.

Gasoline futures for January delivery tumbled to 90 cents.

For gas prices to get close to a $1, oil prices probably would need to fall another $10 a barrel.

“Just seeing that ‘1’ up there is just hard to imagine,” said attorney Kevin Keating, 65, as he filled up his Volvo S60 at a station in Phoenix that advertised prices at $1.67. “Wasn’t that long ago that we worried about the ‘4’ being up there.”