STREAMING NOW: Watch Now

US pipeline shutdown sparks worries of $3 gas

A cyberattack forced the largest US fuel pipeline to...

Posted: May 10, 2021 9:24 AM
Updated: May 10, 2021 12:00 PM

A cyberattack forced the largest US fuel pipeline to shut down Friday, and analysts are worried the disruption could result in a spike in gas prices.

The Colonial Pipeline system spans more than 5,500 miles and transports about 45% of all fuel consumed on the East Coast. It transports 2.5 million barrels per day of gasoline, diesel, jet fuel and home heating oil.

Colonial Pipeline Company said it was the victim of a cybersecurity attack that involved ransomware. In an update on Sunday, the company said that its four mainlines remain offline, but some smaller lines between terminals and delivery points are now operational. The pipeline's owners include Royal Dutch Shell.

'We are in the process of restoring service to other laterals and will bring our full system back online only when we believe it is safe to do so, and in full compliance with the approval of all federal regulations,' it added in a statement.

The shutdown could extend a recent jump in gasoline prices — especially if the outage persists — piling on the pain for drivers as the seasonal peak in demand approaches.

'The number of days that the line is out of service is critical,' Tom Kloza, global head of energy analysis for the Oil Price Information Service, which tracks gas prices at 140,000 US stations, told CNN Business.

'The greatest concern is in coastal states from Georgia north to the Delmarva Peninsula,' Kloza said, referring to the peninsula that includes parts of Delaware, Maryland, and Virginia. Supply to the northeast can readily be supplemented with foreign imports of gasoline, he said, but several other states don't have that advantage. 'Tennessee is also a primary supply concern, as it often runs out of gasoline during normal circumstances,' he said.

The US Department of Transportation on Sunday said it has issued an emergency 'hours of service' exemption in response to the shutdown that will allow truck drivers transporting gasoline, diesel and jet fuel to work longer days.

Limited supply could mean higher fuel prices for motorists during the spring driving season. US gasoline futures for May delivery gained 1.5% on Monday, rising to $2.16 a gallon. Prices had spiked as much as 4% in early trading.

The national average pump price of regular gas stands at $2.97 a gallon, according to AAA, up more than 60% from a year ago when prices and demand were bottoming out. The national average could surpass $3 a gallon this summer, and go even higher if hurricanes hit the Gulf Coast or if there are additional supply outages.

Analysts at GasBuddy, which tracks over 150,000 gas stations in North America, said that it will take days for normal conditions to return even after the pipeline is back online.

'It's very difficult to pin the exact amount prices may rise, but for now, it appears to be a few cents per gallon, possibly growing more significant if the pipeline remains shut down for more than 2-3 more days,' wrote the analysts.

Andy Lipow, Houston-based oil consultant and President of Lipow Oil Associates, emphasized that the timeline is crucial. 'Two days can be made up in orderly fashion,' he said of the current shutdown. Five days, however, could be a much more significant blow to logistics.

The pandemic had already put the industry under pressure. The United States faces a shortage of tanker truck drivers, after many left the business a year ago when gasoline demand ground to a near halt during coronavirus shutdowns.

The attack could also trigger challenges for jet fuel deliveries, Kloza said. Many major East Coast airports maintain only three to five days worth of inventory, so a two to five day suspension of a pipeline that in some cases moves fuel directly to major airports — such as Atlanta's Hartsfield Jackson Airport — can have a dramatic impact.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 320107

Reported Deaths: 7378
CountyCasesDeaths
DeSoto22291269
Hinds20741421
Harrison18444317
Rankin13917282
Jackson13731249
Madison10270224
Lee10060176
Jones8473167
Forrest7834153
Lauderdale7263242
Lowndes6523150
Lamar636088
Lafayette6314121
Washington5426137
Bolivar4841133
Panola4671110
Oktibbeha466398
Pearl River4606147
Marshall4574105
Warren4440121
Pontotoc425973
Monroe4161136
Union415877
Neshoba4064180
Lincoln4009113
Hancock387087
Leflore3516125
Tate342586
Sunflower339491
Pike3372111
Alcorn327473
Scott320374
Yazoo314371
Adams308386
Itawamba305178
Copiah299966
Coahoma298984
Simpson298589
Tippah292268
Prentiss284261
Leake272274
Marion271280
Covington267283
Wayne264842
Grenada264087
George252251
Newton248963
Tishomingo232268
Winston230181
Jasper222148
Attala215173
Chickasaw210559
Holmes190374
Stone188733
Clay187954
Tallahatchie180041
Clarke178980
Calhoun174232
Yalobusha167840
Smith164134
Walthall135447
Greene131834
Lawrence131224
Montgomery128643
Noxubee128034
Perry127538
Amite126342
Carroll122330
Webster115032
Jefferson Davis108334
Tunica108127
Claiborne103130
Benton102325
Humphreys97533
Kemper96729
Franklin85023
Quitman82316
Choctaw79118
Wilkinson69632
Jefferson66328
Sharkey50917
Issaquena1696
Unassigned00

Alabama Coronavirus Cases

Cases: 549013

Reported Deaths: 11311
CountyCasesDeaths
Jefferson810461571
Mobile42145831
Madison35718525
Tuscaloosa26179458
Shelby25626254
Montgomery25089614
Baldwin21901314
Lee16287176
Calhoun14724327
Morgan14639285
Etowah14183364
Marshall12454230
Houston10791287
Elmore10301214
Limestone10188157
St. Clair10161251
Cullman9958201
Lauderdale9612250
DeKalb8977190
Talladega8462184
Walker7341280
Autauga7242113
Jackson6953113
Blount6950139
Colbert6415140
Coffee5638127
Dale4930116
Russell454941
Chilton4478116
Franklin431782
Covington4279122
Tallapoosa4144155
Escambia401880
Chambers3728124
Dallas3610158
Clarke353161
Marion3245107
Pike314578
Lawrence3134100
Winston283572
Bibb268564
Geneva258481
Marengo250665
Pickens237062
Barbour234559
Hale227178
Butler224671
Fayette218962
Henry194443
Randolph187644
Cherokee187345
Monroe180641
Washington170739
Macon163051
Clay160159
Crenshaw156357
Cleburne153644
Lamar146937
Lowndes142254
Wilcox126930
Bullock124542
Conecuh113630
Coosa111629
Perry108626
Sumter105832
Greene93634
Choctaw62125
Out of AL00
Unassigned00
Tupelo
Clear
76° wxIcon
Hi: 80° Lo: 66°
Feels Like: 76°
Columbus
Partly Cloudy
75° wxIcon
Hi: 80° Lo: 68°
Feels Like: 75°
Oxford
Clear
72° wxIcon
Hi: 79° Lo: 61°
Feels Like: 72°
Starkville
Partly Cloudy
75° wxIcon
Hi: 79° Lo: 66°
Feels Like: 75°
Last night's cold front has moved on, leaving us a bit cooler and drier into Tuesday. Clouds clear out quickly, leaving us sunny into the afternoon with low humidity.
WTVA Radar
WTVA Temperatures
WTVA Severe Weather