Gas prices down, oil rising

The gift that keeps on giving is at the gas pumps, as the average price for a gallon of regular no-lead slipped further over the weekend.

The five-county Philadelphia region saw an average price of $1.71, down 2 cents, AAA Mid-Atlantic said today.

South Jersey's average was down 3 cents, to $1.46. The U.S. average was down 2 cents, to $1.64.

Today, there are 11 states with averages at or below $1.50, the auto club said.

Diesel prices continued to decline, too: The Philly region's average was down 6 cents, to $2.67; South Jersey's dropped 2 cents, to $2.38; and the national average shed 3 cents, to $2.44.

Meanwhile, tensions generated by a widening conflict between Israel and Palestinian militants sent crude prices up sharply to above $40 a barrel today, with gasoline and heating oil also making sizable gains.

Prices also were supported by indications that key OPEC members were acting on commitments to cut back production, in line with a decision earlier this month to take a daily 2.2 million barrels off the market.

Light, sweet crude for February delivery rose $2.51 to $40.22 a barrel in electronic trading on the New York Mercantile Exchange by afternoon in Europe. The contract on Friday rose $2.36 to settle at $37.71.

Oil prices have fallen 73 percent since peaking at $147.27 a barrel on July 11 as a credit crisis in the United States sparked a steep drop-off in consumer demand and corporate earnings.