Gas prices continue to drop across the North Bay

Motorists are getting an early December gift in the form of plummeting gasoline prices, which hit $3.56 for a gallon of regular Tuesday in Santa Rosa, down more than $1 from record levels set just two months ago.

Experts attributed the dramatic price drop to lower demand and robust supply, predicting pump prices will continue to fall this month and continue in 2013.

"We're in a good place right now," said Cynthia Harris, AAA Northern California spokeswoman.

Crude oil prices — a key factor in the price consumers pay — are hovering under $90 a barrel, and Harris said she sees no volatility in the West Coast petroleum market.

"Right now we're coasting," she said, with lowered gas consumption, cheaper winter-blend fuel in use and no hiccups at California oil refineries.

Overall, prices have dropped 26 cents a gallon over the past month in Northern California, AAA reported Tuesday.

Santa Rosa's average price has dropped 30 cents over the past month, to $3.56 a gallon on Tuesday. A year ago, local motorists paid $3.61 a gallon. Santa Rosa's all-time record price was $4.65 on Oct. 9, according to AAA figures.

Prices have tumbled 42 cents a gallon over the last month in Ukiah, tied for the largest drop in Northern California. San Rafael dropped 25 cents and Eureka fell a mere 9 cents.

More than 30 Santa Rosa gas stations were pumping regular for less than $3.56 on Tuesday, according to the website GasBuddy.com, which posts prices reported by motorists. The lowest price was $3.39 at the Shell station on Steele Lane at County Center Drive.

Looking ahead, the U.S. Energy Information Administration forecast a national average price of $3.43 per gallon of regular in 2013, compared with $3.63 this year and $3.53 in 2011.

California gas prices typically run 20 to 40 cents above the national average.

U.S. crude oil production is on track to rise this year by about 760,000 barrels per day, the biggest annual increase in oil output since U.S. commercial crude oil production began in 1859, said Tancred Lidderdale, a supervisor with the energy agency.

Next year, U.S. oil production is expected to top 7 million barrels per day for the first time since 1992, he said.

Robust oil and gas production in the U.S. and Canada is projected to turn the region into a net energy exporter by 2025, according to Exxon's latest long-term energy report, released Tuesday. The U.S. will be exporting large volumes of natural gas by then, and producing more oil while consuming less, the Associated Press reported.

The U.S. could overtake Saudi Arabia as the world's top crude oil producer by 2020, the International Energy Agency said last month.