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Gas prices likely to fall as oil slides

Lower gasoline prices are on the way after light sweet crude oil prices dropped almost eight percent this week to a 19-month low on the New York Mercantile Exchange. (Nick Ut/Associated Press)

NEW YORK -- US drivers could start seeing lower prices at the pump as early as this weekend, thanks to the plummeting price of crude oil and a seasonal dip in gasoline, analysts say.

A gallon of regular unleaded gasoline costs an average of $2.325 nationwide, according to the AAA.

"That's probably going to be the highest price you pay in January," Oil Price Information Service analyst Tom Kloza said. "We're going to get a nice little energy price dividend in January: If you're buying heating oil, you're going to pay a lot less than last year, and we're definitely going to be paying less for gasoline than we did in December."

Gasoline prices typically fall in January amid weaker demand, Kloza said, before picking back up around Valentine's Day and rising through the summer.

Also helping to temper gasoline prices is the recent slide in crude oil prices. Light, sweet crude for February delivery dropped as low as $54.90 yesterday -- the lowest price in 19 months -- before climbing back to settle at $56.31, up 72 cents on the New York Mercantile Exchange.

After sharp drops on Wednesday and Thursday, crude prices fell nearly 8 percent for the week, the biggest one-week drop since April 2005.

February Brent crude on London's ICE Futures exchange rose 53 cents to settle at $55.64, after earlier dropping as low as $54.50.

Gasoline prices rose less than a penny to $1.493 after earlier falling as low as $1.46.

In other Nymex trading, heating oil futures rose less than a cent to $1.5658 a gallon after dropping as low as $1.5334 in the session. Natural gas prices rose 2.2 cents to $6.184 per 1,000 cubic feet.

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