Gas prices are still falling and falling sharply. Reuters writes, "The average retail price for a gallon of gasoline in the United States fell more than 48 cents per gallon in the past two weeks to $2.30, according the latest nationwide Lundberg survey."

In general the trend would appear to be completely positive although it could be a sign of another major product that is going through a deflationary cycle.

But, there is a more insidious effect which may be bad for the US consumer. OPEC has indicated that it will cut supply and cut it very sharply. Members of the cartel cannot repair that national budget deficits with prices this low so it appears that the cuts will be as deep as they need to be to get oil moving back toward $80 or $90.

In the meantime, there is evidence that Americans are driving more and, in some cases, moving back to buying less fuel-efficient vehicles. Alternative energy companies, particularly in the ethanol business, are trading at 52-week lows. Some may even go out of business.

There had been some hope that conservation of gas and fuel oil was here to stay when prices to fill up a car were above $4 a gallon. If the public forgets those days, it may be caught flat-footed by a big OPEC supply cut.

Douglas A. McIntyre is an editor at 24/7 Wall St.