The price of gasoline in Bermuda fell 2.4 cents a litre as of yesterday after the cost of crude oil has continued to plunge around the world in the wake of September 11 terrorist attacks.

The price of gas has fallen world-wide because of weak demand and the plunging cost of crude oil. Minister of Finance Eugene Cox announced yesterday announced that gas had dropped 1.95 percent to $1.20.5. The cost of diesel fell by 1.6 cents a litre or 1.6 percent to now stand at $1.005 and kerosene dropped 1.5 cents to 76.7 cents a litre. The new prices were effective as of yesterday.

In October the price of gas fell 7.4 cents making a litre of gasoline $1.229, diesel dropped 1.5 cents to $1.021 a litre, and kerosene fell 4.1cents to 78.2 cents. In the United States the price of gasoline has fallen 4.5 cents in the past two weeks and some regions of the country are paying buck-a-gallon gas for the first time in months.

The lowest price in the United States on Friday for a gallon of regular grade was 97 cents in Atlanta, and the highest was $1.82 in Honolulu.

The average US retail price of gasoline, including all grades and taxes, was about $1.23 per gallon on Friday. According to AP press agency, the price of gasoline has fallen 32.2 cents since September 7, shortly before the terrorist attacks that further slowed the nation's economy.

Prices are the lowest for this time of year since 1998 and show no sign of rising through the end of the year.

And while demand is typically weak during early November, and uncertainty about the economy has further depressed the world's thirst for gasoline, jet fuel and other oil products, but the ongoing drop in crude oil prices is the main reason pump prices continue to slide.

Yesterday world-wide prices continued to fall after Russia failed to offer much hope that it would meet OPEC's demands and join the cartel in making supply cuts.

London Brent blend lost 73 cents to $17.02 a barrel, not far from a $16.80 a barrel low hit last week when OPEC ministers decided against implementing fresh output reductions until Russia made a firm commitment to cut production.

In a meeting in Moscow yesterday with his Mexican counterpart, Russian Energy Minister Igor Yusufov offered no new reductions, a Russian Energy Ministry source said.

Mexican Oil Minister Ernesto Martens is OPEC's closest among independent producers, having already proposed a reduction in Mexico's exports of 100,000 barrels a day, about six percent, to help OPEC.

Russia, the world's second biggest oil exporter, has proposed only a tiny reduction of 30,000 bpd (barrels per day), just 0.1 percent of its three million bpd of exports.

On Sunday in Canada, Russian Finance Minister Alexei Kudrin said Moscow was prepared to negotiate but would not make large reductions.

"I didn't say it (30,000 bpd) was the final word," Mr. Kudrin said in an interview with Reuters. "It is a matter of our negotiations."

"We are not prepared to carry out those profound cuts in our production," he added.

Mr. Kudrin said that Russia's balance of payments was strong and so he was not worried about low oil prices.

But the impact on the Russian economy immediately started to show on Monday with the rouble hitting a new record low of 29.80 to the U.S. dollar.

The Organisation of the Petroleum Exporting Countries at a meeting last Wednesday decided against implementing output curbs of 1.5 million bpd until January, pending co-operation from Russia and other non-OPEC suppliers.

"There is no indication that OPEC is bluffing," said Paul Horsnell of investment bank J.P. Morgan. "And there are also no signs of anything less than unanimity among its members for a strategy that looks like the 1997-1999 period with the fast forward button pressed down."

Oil prices slumped below $10 in late 1998 and early 1999 before OPEC, with the help of Mexico, took enough oil off the market to lift prices. Russia at the time paid lip service to the idea of cuts but, beyond normal seasonal export changes, made no effort to rein in output.

OPEC this year already has cut output close to the lows of mid-1999, removing 3.5 million bpd, but has failed to prop up prices because of growing non-OPEC output and faltering demand hurt by slowing world economic growth.

Cheaper oil should help spur a recovery in the world economy and revive demand for oil. Some economists calculate that if oil were to average $15 a barrel next year, down $10 from this year, it would add about 0.5 percent to world economic growth.