EXPLAINER: What's next for pipelines after Colonial hack
The nation’s largest fuel pipeline is flowing again after the company that runs it was hit by a gang of hackers
May 14, 2021, 12:09 AM
6 min read
Share to FacebookShare to TwitterEmail this articleA fuel tanker driver delivers a 9000 gallon load of fuel at the Sheetz in Raleigh, N.C., Thursday, May 13, 2021. Operators of the Colonial Pipeline say they began the process of moving fuel through the pipeline again on Wednesday, six days after it was shut down because of a cyberattack. (Travis Long/The News & Observer via AP)
WASHINGTON -- The nation’s largest fuel pipeline is flowing again after the company that runs it was hit by a gang of hackers. But long lines remain at gas stations throughout the Southeast. That's because drivers are buying more gasoline than they need, draining supplies at filling stations. Plus, there are logistical hurdles slowing fuel deliveries from the Colonial Pipeline.
The incident was one of a series of wake-up calls about the growing threat hackers pose to the nation's critical infrastructure. Ransomware attacks, where hackers demand large sums of money to decrypt stolen data or to prevent it from being leaked online, have hit thousands of businesses and hundreds of health care centers in the U.S. in the past year.
Questions remain about what steps companies or government officials should take to buttress defenses against cyberattacks.
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WHEN WILL FUEL SUPPLIES GET BACK TO NORMAL?
Colonial restarted its pipeline late Wednesday, which means fuel is now running between refineries in Houston and Southeast states. But it will take a few days or weeks for everything to get back to normal.
Gas stations in the Southeast should be open for business and well supplied next week, but only if the pipeline operates as planned and consumers stop hoarding fuel, said Richard Joswick, global head of oil analytics at S&P Global Platts. When the panic passes, people will have full tanks and demand will drop, but “people have to be convinced that they don’t have to panic buy,” Joswick said.
There's also the matter of getting fuel from the pipeline to the pumps.
Different types of fuel — including gasoline, jet fuel and diesel — are moved through the pipeline system, and they can’t all be flowing through the same pipes at the same time. One of the main arteries from Houston to North Carolina moves different grades of gasoline, sending a batch of premium grade followed by regular, Joswick explained.
Another artery transports diesel, jet and home-heating fuel. Then there's a labyrinth of storage tanks and smaller pipelines that are loaded and unloaded with different types of fuel.
Trucks deliver fuel at different points along the way, but with a national trucker shortage, it isn’t easy for trucks to pick up all the slack.
“The supplies themselves really aren’t the issue, it's more the transportation,” said Akshaya Jha, assistant professor of economics and public policy at Carnegie Mellon University. “It’s really going to be transportation bottleneck.”
Prices for gasoline have spiked in some areas, and were already on the rise heading into the busy summer driving season, but those local price hikes are isolated and not likely to last, experts say.
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WHAT HAPPENS NEXT TO COLONIAL PIPELINE?
After the dust has settled, Congress is likely to call hearings to question Colonial Pipeline executives and cybersecurity experts to help figure out what went wrong and how events like this can be prevented in the future. An outside audit of Colonial's information management practices three years ago found glaring problems.
The chairman of the Federal Energy Regulatory Commission, Richard Glick, said the government should create and enforce mandatory pipeline-security standards similar to those that have been required of the electricity sector for more than a decade.
And members of the House Energy Committee re-introduced bills this week aiming to strengthen the Department of Energy's ability to respond to cybersecurity threats and to encourage more coordination between the federal government and utilities.
