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Drivers face $3 gas prices after the Colonial Pipeline cyberattack, and some gas stations have run out completely

May 11, 2021, 21:03 IST
Business Insider
Trucks line up at a Colonial Pipeline facility.Jay Reeves/AP
  • The American Automobile Association said fuel prices could soar after the Colonial Pipeline cyberattack.
  • Some gas stations reported running out, and the shortages could hit the aviation industry, too.
  • Average national retail prices for gas rose to $3.05 a gallon last week, according to the EIA.
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Gas prices in the US have hit $3 a gallon at gas stations - and experts warn that they could rise further as the US' largest fuel pipeline remains offline following a cyberattack.

Colonial, the largest US refined fuel pipeline operator, reported a cyberattack involving ransomware Saturday that took some systems offline and forced it to temporarily halt operations. The FBI said Monday that DarkSide was behind the attack.

The 5,500 miles of pipeline carry nearly half the fuel consumed by the East Coast.

Some gas stations are now running low on supplies, but the American Automobile Association (AAA) urged drivers against panic buying, advising them to reduce their fuel consumption instead.

The Energy Information Administration said Monday that the average national retail prices rose to $3.05 a gallon last week, the highest since November 2014.

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The AAA forecasted further price hikes following the shutdown of the Colonial Pipeline.

AAA spokesperson Jeanette McGee said in a statement that the impacts of the cyberattack would vary regionally. She said that Mississippi, Tennessee, and the east coast from Georgia into Delaware are "most likely" to suffer from fuel shortages and price increases, which she said could be between $0.03 and $0.07.

The AAA said that other areas of the country "will see little impact."

Prices at the pump have been rising steadily as the US economy reopens after crashing dramatically last spring, hitting lows of around $1.80 in late April 2020.

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Some motorists have been stocking up on fuel amid reports of shortages. Patrick De Haan, head of petroleum analysis at fuel-supply monitoring site GasBuddy, said that this "will make the problem much much more acute and likely double or triple the length of any supply event, if it comes to that."

GasBuddy data late Monday night showed that nearly 7% of gas stations in Virginia had run out of gas.

The fuel shortage is also affecting the aviation industry.

Tom Kloza, global head of energy analysis for the Oil Price Information Service, told CNN Business that many major East Coast airports only keep enough jet fuel to last between three and five days. Some, such as Atlanta's Hartsfield Jackson Airport, get their fuel directly from the Colonial Pipeline, he added.

American Airlines, meanwhile, added additional stops to two long-haul flights from North Carolina so that the planes could refuel.

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Colonial said late Sunday its four mainlines remained offline, but that some smaller lateral lines between terminals and delivery points were operational again. It added Monday that it hoped to restore most operations by the end of the week.

The AAA said other pipelines, alongside the Department of Transportation's temporary hours-of-service exemption for tanker trucks transporting fuels, "will be able to ease the strain, but not resolve the issues caused by the pipeline interruption."

The association added that there could still be delays even after the pipeline is running again, because it takes between 15 and 18 days for fuel to flow from Texas to New York.

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