Diesel prices continue to fall, with the national average dropping 3.3 cents last week to $2.186, according to the weekly report from the U.S. Energy Information Administration.


The national diesel average is now $1.21 less than it was a year ago. The highest prices were found in the New England region, where they're averaging $2.559. The lowest average was reported in the Gulf Coast region at $2.133, followed closely by the Midwest at $2.137.

Gasoline prices, on the other hand, have been heading back up for weeks. This week's EIA report saw them up 3.8 cents from the previous week to $1.964. Analysts are now saying that diesel prices could drop back down below the price of gasoline, which was the traditional relationship for many years.

Refinery expansions are allowing companies to produce more diesel fuel, at the same time demand for diesel has shrunk because of the slowing economy.

Meanwhile, crude oil prices fell below $35 a barrel Tuesday, as light, sweet crude for March delivery fell $2.58 to settle at $34.93 a barrel on the New York Mercantile Exchange.