The US government and the top US fuel pipeline operator are working to secure the network that transports nearly half of the East Coast’s supplies as a shutdown to halt a ransomware cyberattack entered a fourth day.
The attack on Colonial Pipeline last week, one of the most disruptive digital ransom schemes ever reported, has sent shockwaves across the industry.
The resulting shutdown has disrupted fuel supply across the eastern United States, triggered isolated sales restrictions at retail pumps and pushed benchmark petrol prices to a three-year high.
US lawmakers urged stronger protections for critical US energy infrastructure, and the White House has made restarting the fuel network a top priority and organised a federal task force to assess the impact and avoid more severe disruptions.
The #FBI was notified of a network disruption at Colonial Pipeline on May 7, 2021. We are working closely with the company and our government partners.
— FBI (@FBI) May 10, 2021
The south-eastern United States would likely be the first to see price increases at retail pumps, and demand has already picked up as drivers fill their tanks.
The south-east is the most dependent on the line and has fewer alternatives than states further north, and has seen prices spike during previous shutdowns.
“My biggest concern, as far as the consumer goes, is that you end up with a run on the petrol supplies at the gas station, further exacerbating what is happening at the terminals,” said Andrew Lipow, president of consultants Lipow Oil Associates LLC.
While the US government investigation into the attack is in its early stages, a former US official and three industry sources said the hackers are suspected to be a cybercriminal group called DarkSide.
Cybersecurity experts said the group appears to be composed of veteran cybercriminals focused on squeezing as much money as they can from their targets.
Colonial said on Sunday it restarted some smaller lines between fuel terminals and customer delivery points but its main lines remained shut. It did not provide a timeline for a full restart of the 8850-kilometre system.
The pipeline system is the primary fuel artery from Gulf Coast refineries to Mid-Atlantic and south-east states.
It moves more than 2.5 million barrels per day (bpd) of petrol, diesel and jet fuel, supplying motorists and major airports.
The Department of Transportation announced emergency measures on Sunday to facilitate deliveries, lifting driver restrictions on fuel haulers in 17 states affected by the shutdown.
Traders provisionally booked at least six tankers to ship petrol from Europe to US destinations following the attack.
Two European petrol traders, however, said the market was taking a cautious approach to see how long the shutdown would last.
The line supplies jet fuel to major airports including the nation’s busiest, Hartsfield-Jackson International in Atlanta. The airport expects the outage to be resolved before any impact on flights, a spokesman said.
“A herculean effort would be needed from other sources to make up the shortfall (in the East Coast,) if the pipeline disruption is prolonged,” RBC Capital Markets wrote in a note.