Panic buying and long queues have hit gas stations along the Southeast coast as the country’s largest oil pipeline has been shut down by a devastating cyberattack suspected to be organised by a Russian-based criminal gang.
The 5,500-mile Colonial Pipeline, which transports more than 100 million gallons of fuel a day from Texas to New Jersey, is now in its fifth day of closure. The Alpharetta, Georgia-based firm halted all activities after being struck by a ransomware attack on Friday that may be one of the most expensive in US history.
Colonial said Monday that it hopes to reopen most of its operations by the weekend, but that won’t be soon enough to stop shortages and price spikes because supply has already begun to run out.
According to GasBuddy analyst Patrick DeHaan, about 7.6% of gas stations in Virginia were out of gas by early Tuesday. He went on to say that nearly 5% of gas stations in North Carolina, 3.3 percent in Georgia, and 2.4 percent in Florida have reported running out of gasoline.
Due to the shortages, North Carolina Governor Roy Cooper declared a state of emergency on Monday to help ensure the state has enough gasoline.
The scarcity of supplies seems to have been compounded by panic purchasing. According to DeHaan, demand for gasoline increased by more than 40% in Georgia, Florida, South Carolina, North Carolina, and Virginia.
According to the Citizen Times, supermarket chain Ingles, which operates gas stations throughout North Carolina, South Carolina, Georgia, and Tennessee, is already experiencing shortages and running out of gas at some of its locations.
At an Exxon Mobil station in Asheville, North Carolina, a clerk answered the phone with “Hello, I’m currently out of gas,” according to Bloomberg. The outlet added that another station in Manning, South Carolina, had bagged their pumps and marked them “Out of service.”
RaceTrac, located in Atlanta, reported to WSBTV-2 that some of its Georgia gas stations are currently experiencing outages. WBTW-TV confirmed that lines are getting longer at stations throughout South Carolina, from Marion and Mullins to Myrtle Beach, as drivers search for gas.
On Monday night, social media was flooded with worries about gas shortages and videos of panic buying.
Colonial’s CEO Joseph Blount told state officials in a meeting on Monday that supply shortages could occur during the week as the company and the federal government work to get operations back up and running, according to Bloomberg. The White House said it is “monitoring supply shortages in parts of the Southeast,” according to the outlet.
Although the company said Monday that it is manually operating a portion of the pipeline that runs from North Carolina to Maryland, the majority of the line remains offline. Colonial is investigating and responding to the hacking in collaboration with the federal government. Commerce Secretary Gina Raimondo said Sunday that an “all-hands-on-deck” effort is underway to restore operations.
“We are working closely with the company, state and local officials to make sure that they get back up to normal operations as quickly as possible and there aren’t disruptions in supply,” Raimondo said.
On Monday, the FBI confirmed the cyberattack was carried out by a professional gang of hackers known as “DarkSide.”
DarkSide is known to extort cash from corporations and give a cut to charity, the Associated Press reported Sunday, citing sources familiar with the federal investigation.
In a statement reportedly posted on DarkSide’s website, the group claimed, “Our goal is to make money, and not creating problems for society. From today we introduce moderation and check each company that our partners want to encrypt to avoid social consequences in the future.”
The statement, provided to CNBC by the Boston-based security company Cybereason on Monday, added: “We are apolitical, we do not participate in geopolitics, do not need to tie us with a defined government and look for our motives.”