KNOXVILLE, Tenn. (WVLT) -- The price at the pump continues to go down, as the national average drops to $3.81 a gallon. Tennessee’s average is $3.64 a gallon, and the price of a gas in Knoxville averages $3.67. Oil closed Monday at $114 a barrel.
Prices have already fallen below those averages in areas across East Tennessee.
AAA says prices should continue to drop if everything holds steady.
Drivers paid the highest gas prices ever in Knoxville in July, so now they'll take any price break they can get.
Union County motorist Billy Cox says, “It's better than I what I've been paying. I've been paying, $3.75, $3.74, $3.69. It's definitely a relief from almost four bucks a month ago."
Knoxville's average gas price for regular unleaded has fallen 30 cents in about three-and-half weeks.
Don Lindsay with AAA says, “Slumping economy, strengthening dollar, slowing demand. All these factors are pushing the price of oil down."
And if those factors don't change, Lindsay says what you pay at the pump could drop more.
“Some people are saying we've bottomed out. The truth is nobody really knows."
But drive around East Tennessee and you'll find lower prices.
It's even cheaper in Morristown. We found gas at $3.46 a gallon. That's about a three percent savings, or about two bucks a fill-up less than in Knoxville.
So what's the difference between the two places?
Lindsay says, “Each gas station has its own little market, its own economy that it deals with."
That is based on the wholesale price of gasoline, but AAA says details like rent, taxes, and other details add up to what you pay.
Lindsay says, “So each individual owner's looking at his or her station and saying, I can make money at this price, or I might drop a bit to stay competitive with the person down the street."
What is considered a “good deal” is relative, and all the drivers we talked to say even at $3.58 a gallon, gas needs to drop further.
AAA says the fighting between Russia and Georgia could threaten that by disrupting supplies.
The last time we saw prices around $3.50 was four months ago, but just one week after that gas prices jumped about 15 cents.