New York CNN Business  — 

The unprecedented collapse in gasoline demand in the United States appears to have ended, for now at least.

After weeks of quarantine, Americans are finally getting back on the road to go to stores, beaches and parks, guzzling more gas along the way. And that has sent US oil prices ricocheting off their historic lows.

Traffic in Dallas, Houston and Atlanta – three cities in states where lockdown orders have eased – is increasing slightly, according to an analysis of TomTom GPS data by RBC Capital Markets. At the height of the crisis, traffic in major US cities declined by a stunning 83% below normal levels. As of Monday, that metric improved to negative 74%.

Even congestion in New York City, where stay-at-home orders remain in place to fight the pandemic, has picked up in recent weeks. RBC said that NYC traffic hit a low of 96% below normal in mid-April, but has since rebounded to 88% below normal.

“Demand in the US has bottomed out,” said Michael Tran, RBC’s director of global energy strategy.

Tran pointed to a combination of relaxing rules in states such as Georgia and Texas, warmer weather and “cabin fever” as the major drivers behind the increases.

Gasoline demand in the United States climbed on Wednesday to the highest level for that day of the week since March 18, according to GasBuddy. Demand was up 16% from its March 25 low, though it remains 31% lower than March 11 when stay at home orders started to take effect.

In other words, gasoline demand remains weak – it’s just not as horrible as it was a few weeks ago.

“There’s definitely been a recovery,” said Patrick DeHaan, oil and refined products analyst at GasBuddy.

There are other signs that Americans have begun to move about again.

Orbital Insights, a research firm that uses artificial intelligence and computer vision to analyze data, combed through millions of anonymized smartphones daily to see how far they go from home. The firm found that mobility collapsed 66% below normal levels in early April. But by May 1, that metric was only down 29% from normal levels.

Trump cheers oil rebound

The bottoming out process is pivotal for the battered energy market.

US oil prices crashed into negative territory last month for the first time, a shocking move that reflected fears that the world might run out of room to store unneeded barrels of oil piling up during the pandemic.

Excess production from Saudi Arabia and Russia, which were mired in an epic price war, were partially to blame for the supply glut. But the biggest problem was anemic demand. Drivers around the world were forced off the roads by the crisis. Many passenger jets are still grounded. Countless factories remain offline.

“US gasoline demand is the single largest demand driver for global oil prices, unequivocally,” said RBC’s Tran, noting it amounts to 10% of total demand for oil around the world.

Another factor is that many Americans may be unwilling to get back on a plane until there is a vaccine to fight the pandemic. That could lead to more road trips, further boosting demand for gasoline.

The surge of oil barrels stockpiled around the world is also starting to level off.

There were about 3.2 billion barrels of oil in global inventories as of Thursday, according to estimates by Orbital Insights, which uses satellites to estimate oil contents based on tank shadows. After skyrocketing in recent weeks, that figure has stabilized and even decreased slightly.

That’s why US crude has raced back to life after bottoming at -$37 a barrel on April 20. Oil has spiked 17% to $23.55 a barrel this week, on track for its second-biggest gain of the past decade.

Even President Donald Trump, formerly a vocal critic of OPEC and higher oil prices, is cheering the rebound.

“Oil prices moving up nicely as demand begins again!” Trump tweeted Tuesday.

Gasoline prices off their lows

American drivers, some of whom are hurting financially from mass unemployment, may not be happy to see that prices at the pump are no longer imploding.

The national average for a gallon of gas is now at $1.81, according to AAA. While that’s well below $2.89 a gallon from a year ago, it’s also off the low of $1.77.

During the height of the crisis, more than a dozen US states had at least one gas station with sub-$1-a-gallon gasoline, according to GasBuddy. Now just two stations in the nation are sitting below $1 a gallon, both in Arkansas. “Ultra-low prices have disappeared,” DeHaan said.

These trends, along with record supply cuts by OPEC and Russia, have allowed some cautious optimism to creep back into an oil market that was filled with gloom and doom for much of this year.

“We think the bottom of pricing is in. We don’t think we’ll see a return of negative prices over the short term,” Tran said.

‘Stops and starts’

But oil bulls shouldn’t expect US demand for gasoline to go straight back up. It could take another dip if a second wave of coronavirus infections hits later this year. “We’re expecting stops and starts,” Tran said.

RBC found that after 10 straight days of solid recovery in US traffic patterns, there has been a slight regression in recent days.

For instance, traffic in Houston was down 84% year-over-year around Easter, according to RBC. It improved to just down 70% as of Monday.

However, Tran said that as of Thursday traffic in Houston was back down 74% year-over-year. He said other cities including Dallas, Atlanta, Seattle, Chicago, Boston and Denver experienced a similar trend.

One theory is that although some Americans have emerged from their quarantine, many are still playing it safe and limiting their trips to restaurants and stores.

“Maybe everyone got their fill of freedom before sheltering again,” Tran said.