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Gasoline demand spikes in several states after pipeline hack

Matt Egan May 11 2021

 

A growing number of gas stations along the East Coast are without fuel as nervous drivers aggressively fill up their tanks following a ransomware attack that shut down the Colonial Pipeline, a critical artery for gasoline. The panic-buying threatens to exacerbate the supply shock.

As of 11 a.m. ET Tuesday, 7.6% of the gas stations in Virginia and 5.8% in North Carolina didn't have gasoline, according to outage figures reported by GasBuddy, an app that tracks fuel prices and demand.
 
Outages are also being reported at gas stations in Georgia (4%), Florida (2.5%) and South Carolina (1.9%), according to GasBuddy, which collects user reports and shares the information with the government during emergencies.
 
"Panicked buying" is "running stations in the region dry," Patrick De Haan, head of petroleum analysis at GasBuddy, told CNN Business.
 
He warned that the "irrational behavior" could prolong supply issues "for weeks."
 
US gasoline demand jumped 20% on Monday compared with the prior week, according to GasBuddy.
 
In just five states served by Colonial Pipeline -- Georgia, Florida, South Carolina, North Carolina and Virginia -- demand was up by a collective 40.1%, GasBuddy said.
 
"I got scared that I could not go to work or take my daughters to school," Florida resident Linderly Bedoya told CNN on Tuesday. "All the gas stations in my area were without gas and when I finally found one I had to stay an hour in line and I had to fill up with the premium unleaded."
 
Bedoya posted a photo on Twitter of a sign from a gas station in Tallahassee that warns drivers only premium fuel is available.
 
GasBuddy lists smaller outages, impacting less than 1% of the gas stations, in Alabama and Tennessee.
 
 
Emergency steps to ease supply concerns
 
 
In Georgia, Governor Brian Kemp signed an executive order suspending the state's gas tax to help drivers cope with higher prices caused by the Colonial Pipeline hack. Kemp's order also allows for increased weight limits for trucks transporting fuel and prohibits price gouging
 
Meanwhile, North Carolina Governor Roy Cooper declared a state of emergency Monday evening, a move that allowed him to temporarily suspend some fuel regulations in a bid to ensure adequate supply.
 
The Environmental Protection Agency on Tuesday issued an emergency fuel waiver aimed at easing fuel shortages caused by the Colonial Pipeline shutdown. EPA Administrator Michael Regan cited "extreme and unusual fuel supply circumstances" for waiving certain federal requirements for fuels sold in the District of Columbia, Maryland, Pennsylvania and Virginia. The waiver will continue through May 18.
 
The Colonial Pipeline, which supplies nearly half the diesel and gasoline to the East Coast, said Monday it hopes to be substantially operational by the end of the week after a hack that authorities believe was carried out by a criminal group called DarkSide.
 
"This is a hugely important part of our energy infrastructure on the East Coast," Neil Chatterjee, a commissioner at the Federal Energy Regulatory Commission, told CNN Business on Monday. "These pipelines are now, in many ways, on the front lines of our national defense."
 
The national price at the pump hit $2.985 on Tuesday, the highest level in nearly six years, according to AAA.
 
Investors are taking the supply shock in stride. RBOB gasoline futures are little changed from Friday.
 
 
SOURCE: CNN BUSINESS
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