LOUISVILLE, Ky. (DTN) — Americans have begun leaving their homes and hitting the streets in their vehicles, even before restrictions on social and economic interaction in many states have been lifted. While still well below year-ago and pre-COVID-19 quarantine levels, vehicle transportation activity is clearly trending higher in recent weeks.
Another developing trend apparent in the data is a breakdown between vehicle and public transit activity. Americans are clearly leery of returning to forms of mass transit, and as such this could lead to a stronger-than-anticipated rebound in gasoline demand as state government’s loosen restrictions on economic activity.
Thanks to cell phone application and GPS data there are a number of near-real-time data sources for tracking an individual’s mobility or lack thereof. While we have discussed CityMapper and TomTom data in the past, Apple’s efforts to quantify this mobility data into different streams for different modes of transportations is unique and eye opening. Apple has released mobility trends data based on the change in routing requests in their Apple Maps application from a Jan. 13 baseline, breaking down mobility trends in driving, walking and mass transit.
The most recent data from Apple for May 2 show U.S. driving activity down just 16% from their baseline on Jan. 13. Driving activity is well up from the lows set on April 12, which showed driving activity down nearly 63% from their Jan. 13 baseline. Driving activity based on this methodology has been trending steadily higher since bottoming on April 12, as the weekly lows in driving activity have now been higher for three consecutive weeks.
While national levels have rebounded there are still wide discrepancies between various cities and states. Based on Apple data, driving activity in Los Angeles is still 36% below the Jan. 13 baseline. Driving activity in New York City is still down 33%. But even in the epicenter of the U.S. COVID-19 outbreak, in the early days of May, New York City driving activity is at its strongest since March 16.
In Atlanta, driving activity is only down 9% from its Jan. 13 baseline. Driving activity across many of the smaller cities and less populated states through the central and mid-western United States is even closer to normal levels. Based on Apple data, driving activity in Indianapolis is down just 2% from the Jan. 13 baseline, while driving activity in Louisville is down just 7%. Driving activity in North Dakota is back in line with the Jan. 13 baseline, while driving activity in South Dakota is reportedly 32% above baseline levels.
Prompt month RBOB gasoline futures closed Monday (5/4) at $0.83 gallon, up $0.18 or 28% from week-ago levels. RBOB futures have more than doubled from their recent lows, rising $0.42 gallon from the lows set on March 23.
AAA data show the national average for retail gasoline prices at $1.78 gallon Monday, up 1cts gallon from the week-ago level. Gasoline prices were led higher by the Great Lakes region, as Wisconsin, Ohio, and Michigan, lead national retail prices higher.
The Energy Information Administration’s proxy for gasoline demand, product supplied to the U.S. market, has been moving higher for three consecutive weeks. Weekly product supplied of finished motor gasoline rose to 5.86 million bpd for the week ending April 24, up 790,000 bpd from a low of 5.07 million bpd set in the week ending April 3.
The sustainability of this trend of returning gasoline demand and vehicle travel will likely be closely tied with the relative success of efforts to reopen state economies and social activity across the nation. With 30 million Americans out of work, it is unlikely that gasoline demand can return to seasonal norms for a sustained period without a commensurate snap back in economic activity and employment which seems unlikely at this time.
However, mass transit activity in Apple’s data is pointing to at least a short-term change in behavior which could support gasoline demand despite the lackluster economy. Mass transit activity is still down 72% from its baseline in early January and has yet to show signs of a rebound like driving or foot traffic. As individuals seek to avoid modes of transportation that puts them in close proximity to others, gasoline demand will likely benefit as a result.