US: Detroit is gearing up for NAIAS with gas dropping below $2 a gallon image

For the first time since March 2009, gas prices in Michigan, the home state of Detroit – the motoring capital of America – has dropped below the $2 a gallon threshold.

According to AAA Michigan, in preparation for the eagerly-awaited North American International Auto Show that begins on January 12 and is hosted by the Cobo Center, gas prices dropped 13 cents to $1.97 a gallon starting with New Year’s Day 2015. That makes the average price of a gallon of regular gasoline no less than 42% cheaper than during the same period of 2014 – when it was averaging $3.37 per gallon. “Gas prices continue to drop due to a significant decline in crude oil costs,” says auto club spokeswoman Susan Hiltz. This market price report is just the latest signal in what has become a dramatic gas price turnaround – and one that was not anticipated by many. For example, in Michigan the peak was on June 16, 2014 – at $3.96 a gallon – and then started its steep decline. The national average was also the highest back in June 2014 – at around $3.66 a gallon.

According to the AAA, across the US on New Year’s Day 2015 the national average was not far off, at $2.24 a gallon, with drivers in Midwest paying the least for gas – while the most unfortunate motorists from the contiguous 48 states were in the Northeast. For now, Alaska and Hawaii residents were seeing the smallest price drops – at $3.09 and $3.53 a gallon on average, respectively. According to senior petroleum analyst Patrick DeHaan, the prices under the $2 a gallon threshold won’t last much and the drivers should expect a slight rise throughout the year, though the prospects are for the price of gas not returning above the $3 per gallon level for the entire 2015.