Storage tanks stand at the junction of Pelham Colonial Pipeline Co. and tank farm in Pelham, Alabama, the United States, Monday, September 19, 2016.
Luke Sharrett | Bloomberg | Getty Images
US Secretary of Commerce Gina Raimondo on Sunday said the federal government was working to avoid supply disruptions after Colonial Pipeline, the operator of the nation’s largest fuel pipeline, temporarily suspended all operations due to a ransomware attack on Friday.
“This is what businesses need to be concerned about now,” Raimondo said in an interview on CBS “Face the Nation”. “Unfortunately, these types of attacks are more and more common. They are here to stay.”
President Joe Biden has been made aware of the ransomware attack and the FBI has said it is working closely with Colonial Pipeline and government partners to remedy the situation.
The Department of Energy is monitoring potential impacts on the fuel supply, and the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency is coordinating with the company.
Colonial Pipeline said it learned on Friday that it “fell victim to a cybersecurity attack” and has since closed 5,500 miles of pipeline that carry nearly half of the fuel supplies on the East Coast, raising fears of one-time shortages of gasoline. ‘gasoline, diesel and jet. fuel.
“It’s an effort of all hands on decks right now,” said Raimondo. “We are working closely with the company, national and local authorities to ensure that they return to normal operations as quickly as possible and that there are no supply disruptions.”
Commerce Secretary Gina Raimondo testifies before the Senate Appropriations Committee during a hearing in the Dirksen Senate Office building on Capitol Hill in Washington, DC on April 20, 2021.
Chip Somodevilla | Swimming pool | Reuters
The company connects Gulf Coast refineries to more than 50 million people in the southern and eastern United States, according to its website.
The ultimate impact of the attack on fuel prices is unclear as there is no timeline for Colonial’s resumption of operations, according to Bernadette Johnson, senior vice president of energy and energies renewable at Enverus. Johnson predicted a short-term spike in refined product prices due to a short-term outage.
“Storage of refined products both in the USGC and in the Northeast can mitigate the impact of a short-term event,” Johnson said on Saturday.
But if the shutdown persists, the country could see fuel shortages growing rapidly, according to John Kilduff, a partner at Again Capital in New York. Kilduff predicted that gasoline prices would skyrocket when futures markets open on Sunday night if the company does not resume operations by then.
Johnson agreed: “If this outage were to persist for a significant period of time, there would be product shortages in the Northeast and a glut of product in the USGC, which would impact prices across the board. country, ”she said.
Gas futures gained 0.6% to $ 2.1269 per gallon and diesel futures rose 1.1% to $ 2.0106 per gallon Friday on the New York Mercantile Exchange.