Gas Prices Drop To Lowest Level in 10 Months, OPEC Warns of Further Cuts

Washington DC November 7, 2006; The AIADA newsletter reported that the price of gasoline has fallen to its lowest level in more than 10 months, as the federal Energy Information Administration announced Monday that U.S. motorists paid $2.20 a gallon on average for regular grade last week, a decrease of 1.8 cents from the previous week, reports the Associated Press.

Until now, gas prices remained high all year — and surpassed $3 this summer — amid soaring crude-oil prices, tight refining capacity and fears that there would be a return of the extreme hurricane season.

Last month, at a meeting in Qatar, OPEC decided to cut supplies by 1.2 million barrels a day effective Nov. 1. Saudi Arabian Oil Minister Ali al-Naimi predicts that the effects of the cut will be felt by the middle of this month.

Ali al-Naimi hinted that OPEC would cut production further at its Dec. 14 meeting if prices remain low: "We will look at the numbers we will assess the market, if it is out of balance we will take some more action."