Half of the East Coast’s fuel supply is in limbo after a cyber attack by “DarkSide” on the Colonial Pipeline Company Friday.
The Georgia-based company was hit with a ransomware attack and said it preemptively shut down the country’s largest oil pipeline while it evaluates the situation. So far, gas prices have only seen a marginal increase, but that may change if the shutdown continues.
According to the FBI, a criminal enterprise known as “DarkSide” was responsible for the attack. The group, based in Eastern Europe, is known to steal from major corporations and give a cut of their ransoms to charity, according to CBS News.
“It’s the most significant, successful attack on energy infrastructure we know of in the United States,” energy researcher, Amy Myers Jaffe, told Politico.
— FBI (@FBI) May 10, 2021
Gas prices have already been rising in recent months at a rate of a few cents per week as the economy reopens and commodity prices increase across the board. Gas prices rose about one cent after Friday’s shutdown became known, but an increase of only three more cents in the national average will see prices hit their highest point since November 2014, according to CBS.
AAA, a site that supplies daily has reports for the U.S., forecasted an increase in prices at the start of the week. The shutdown could cause a supply shortage, the organization said, triggering price rationing until the tap is turned back on.
The shutdown won’t cause major disruption unless it lasts an extended period of time, said Patrick DeHaan, head of petroleum analysis at GasBuddy. He told Reuters that a shutdown of three more days would result in a serious impact on prices.
DeHaan warned against panic-buying or hoarding of gasoline. Colonial supplies 45% of all the fuel consumed on the East Coast, so supply will be tighter until the issue is resolved.
Still, some gas stations are already running on their last supply. Democratic North Carolina Gov. Roy Cooper issued a state of emergency to temporarily suspend fuel regulations after the pipeline shutdown.
One Citi location in Asheville, NC ran out of fuel Monday.
“Everyone’s panicking,” employee Jessica Alcocer told the Asheville Citizen-Times. “The reserves are still full, and we have deliveries still scheduled — that’s what I know.”
In Virginia, 7% of gas stations were out of fuel Tuesday and demand for gas is up 20% nationwide. (RELATED: Some Americans Report Local Stations Squeezed Out Of Gas In Wake Of Pipeline Attack)
The pipeline runs all the way from the Gulf region to New Jersey. The Southeastern U.S. could be particularly affected by a prolonged shutdown, DeHaan said.
Colonial said its goal is to restore service by the end of this week. If it takes longer, DeHaan says a price surge could be coming.