DTN’s 2018 Thanksgiving Travel Outlook: Weather | Gas Prices
November 20, 2018
Thanksgiving Travel Weather Impacts on the East/West Coast, Tranquil in Between
Thanksgiving is typically the time of year when much of the country begins the transition from fall to winter, and 2018 is no exception. In the days leading up to the biggest travel day of the year (Wednesday), the Continental United States will feature varying types of weather. A quick-hitting snow event will drop several inches of snow from the Great Lakes to New England Monday night through Wednesday. Rain showers will finally bring fire relief to the West Coast on Wednesday. Meanwhile, the central part of the country will remain rather tranquil.
The more substantial travel impacts to roads and in the air will affect the Great Lakes and Northeast beginning Monday night and lingering through Wednesday. A couple waves of snow are likely, with some lake-enhanced totals as well. A general 1-3” of snow is expected, with parts of northern New York and New England in the 3-6”+ range by Wednesday morning. The bulk of the snow will fall Tuesday afternoon and then again Wednesday afternoon.
Out West, rounds of much-needed rainfall will begin Wednesday morning and persist through Thanksgiving weekend. Rain showers are expected to increase in coverage and intensity through the day Wednesday, potentially reaching as far south as Los Angeles by the evening hours. While much of the West Coast will see steady rains, areas above 5,000-7,000’ from the Sierra Nevada Mountains north may see accumulating snows in excess of 6”. Travel by Wednesday night into Thanksgiving morning through the mountain passes will be tough. Things look to quiet down by the weekend.
In addition to the snow across the Northeast, some of the season’s coldest air yet is poised to arrive in the Northeast by Thanksgiving morning. Record lows will be common across the region, as the temperature drops well into the teens along the I-95 corridor, and near zero further north and west. The Thanksgiving parade in New York City may be the coldest one yet!
Geopolitics Pressure Crude Costs to Lower U.S. Gasoline Prices for Thanksgiving Holiday
Retail gasoline prices in the United States remain above year ago heading into the Thanksgiving Day holiday, although the variance is quickly fading, as geopolitical developments in the fourth quarter heavily pressure crude oil prices—the largest cost component for gasoline.
The national average was just under $3 gallon in early October at $2.948 gallon, but has since fallen for six consecutive weeks through this week to $2.70 gallon, with the price decline to continue. We can view the accelerated downtrend through the seasonal chart for gasoline futures, which is traded under the acronym for reformulated blendstock for oxygenate blending. Futures have held above year ago consistently until the last day of October, including when Hurricane Harvey ravished the Houston market in late August, early September 2017. In November, the futures contract plunged to a 16-month low.
Gasoline fundamentals have been bearish in the second half of 2018 despite strong demand amid oversupply, with days of forward supply holding above the five-year average every week since early June save one in late July, data from the Energy Information Administration shows. However, a bull market in crude swept prices for the motor fuel higher into the fourth quarter, with the uptrend spurred by expectations U.S. sanctions on Iranian oil exports would lead to a short global market in the fourth quarter.
The bull market ended abruptly in early October on sharp increases in global oil production and concern over world economic growth. Waivers granted to eight countries, which include China and India, by the United States allowing another 180 days beyond Nov. 5 to continue purchasing Iranian oil accelerated the decline, with the oil market firmly in bear territory for the American holiday.