Crude oil has fallen more than 16 percent this year in a sell-off triggered by a historically warm winter in the Northern United States and sustained by large funds taking short positions in the market, or bets that prices will fall.
Some market participants say another production cut by the Organization of Petroleum Exporting Countries could halt the price drop, but until that happens, there's little to stop prices from sliding further.
"It doesn't feel like it's run its course yet. It will probably fall below $50 a barrel - then the Saudis may be more amenable to an emergency meeting," said Jim Ritterbusch, the president of Ritterbusch & Associates in Galena, Ill.
Light sweet crude futures for February fell $1.59 to settle at $51.21 on the New York Mercantile Exchange, after hitting a low of $50.53 in earlier trading. Tuesday's settlement price was the lowest since May 26, 2005, when crude closed at $51.01.
The U.S. retail price of gasoline has fallen 4.5 percent in 2007 to an average of $2.229 a gallon, according to AAA. As of Tuesday, more than half of the states were seeing average pump prices of less than $2 a gallon.
Drivers should see further savings if crude prices stay low, but only about half of the retail cost of gasoline is determined by the price of crude oil, the U.S. Department of Energy says. The rest factors in distribution and marketing, refining costs and profits, and taxes.
Nymex crude's losses Tuesday were sparked by comments from Saudi Oil Minister Ali Naimi that diminished the chance of an emergency OPEC meeting this week.
Because prices are still high in historical terms, OPEC members continue to pull in big profits. The last time crude oil traded at $40 a barrel was in 2004, but Peter Beutel of Cameron Hanover said in a research note that for roughly 94 percent of OPEC's history, its daily sales have been at prices below $40 a barrel.