Oil prices continued to decline, dipping below $50 a barrel at one point Thursday, as retail gasoline prices stood below $2 in nearly half of the country.

Gas Section | Prices Nationwide | 2-Year Average

Analysts said traders fear the world's economic slowdown could be "pretty severe" and that would cut demand for oil.

Oil prices Thursday fell as low as $49.75 a barrel, levels last seen on May 18, 2005, when oil was at $46.80 a barrel.

Light, sweet crude oil for December delivery is still down $2.64, nearly 5 percent at $50.98 a barrel on the New York Mercantile Exchange.

Gas prices also continued to drop. According to AAA, the national average for a gallon of regular unleaded stood at $2.02 Thursday.

That's nearly 3 cents cheaper than Wednesday, and more than a $1 less than a year ago.

Gas prices have come down more than 50 percent in just four months when they reached a record $4.11 in July.

Gas has fallen below an average of $2 a gallon in 23 states. Alaska is the most expensive state to buy gas, while gas was cheapest in Missouri, according to AAA.

On Wednesday, the Department of Transportation said even with gas prices falling, Americans are cutting back on driving, logging almost 11 billion fewer miles in September.

In addition, AAA said this week that the number of Americans traveling during the Thanksgiving weekend this year is expected to decline for the first time since 2002.

"The overall state of the economy continues to present real challenges for some Americans looking to travel this Thanksgiving," AAA President and CEO Robert L. Darbelnet said in a prepared statement. "However, the desire to spend time with family, combined with significantly lower gasoline prices than earlier this year, will provide a strong impetus for many Americans to travel this holiday season."

More than 33.2 million Americans -- 81 percent of holiday travelers -- are expected to travel by automobile. However, that's down 1.2 percent from the 33.6 million people who drove a year ago.