Gas price drop in time for holiday weekend break

SAN JOSE, Calif. (KTVU) -- Gas prices have dropped across the nation, just in time to give drivers a break for the holiday weekend.

Bay Area gas prices have dropped about 30 cents a gallon in the past month, with some gas stations selling gas for under $3 a gallon.

In East San Jose, the Gas and Shop on McKee Road charges customers $2.62 for a gallon of unleaded gas if you pay cash.

Across the street at Moe's, it's $2.66 a gallon.

That is where we met A.J. Johnson filling up the minivan he drives for his church.

"Because it's the Friendship Church of God in Christ's church van, I want to do the best by the church. So I come here," said Johnson. "But believe me, if I saw the price over [at Gas and Shop] I would have gone over there."

The church deacon may have been smiling when he said, that but for others what they pay at the pump is no laughing matter.

"I hate spending my money on gas," said receptionist Jessica Lopez. "I feel like it's a waste of money even though it gets me to work everyday. But I still feel I put most of my money into gas."

Bay Area gas prices have dropped 10 cents in the last week and nationwide AAA says drivers will see the lowest gas prices for a Labor Day holiday weekend since 2004. The overall drop has had an impact on some drivers' habits.

"I was able to go on vacation. I went to Oregon just last month, so it's been really great," said Debbie Rios, "My husband and I drove from San Jose all the way to Oregon because of the gas prices."

AAA spokeswoman Cynthia Harris says the crude oil supply continues to outpace demand because the U.S. is producing more crude oil than ever before, OPEC hasn't cut its production, and there's speculation Iranian oil will return to the market..

Harris says that all means a forecast of a continued drop in pricing.

Currently San Jose has the lowest average price in the Bay Area at $3.17 for a gallon of unleaded gas.

Oakland is slightly higher at $3.20. San Francisco is the most expensive in the region at $3.33 a gallon.

That's why Lopez, who commutes every day from San Jose, chooses carefully where she fills up.

"It's more cheaper in like Tracy and Modesto, so when I'm in that area I usually fill up there," said Lopez.

AAA doesn't expect consumers to see any affect of the jump in oil prices in the last few days.

Harris said two other factors that could help keep prices down include the upcoming switch in mid-September to the cheaper winter blend of gas, and China's consumer habits. She says China is by far the largest consumer of oil and gas and its economic downturn has translated to a reduction in use.