Analysts Say Gas Prices May Have Peaked

Sacramento, CA — The American Automotive Association of Northern California says gas prices may have hit their peak and are headed back down again.

AAA says prices are falling after surging past the $3 a gallon mark two weeks ago. AAA says the statewide average for a gallon of regular unleaded now stands a $3.03, which is down two cents from the record set last Friday.

That figure is 26 cents higher than August prices and an increase of $1.08 since the first of the year.

AAA says the main reason for last week´s spike in prices is the impact Hurricane Katrina had on nationwide crude oil production. Analysts predict a further fall in prices as demand decreases and Gulf Coast production facilities are repaired and brought back on line.

The report indicates a nationwide average of $2.96 a gallon, with the least expensive gas found in Jackson, Mississippi at $2.57 a gallon, and the most in Hawaii and $3.52.