May 12, 2021

Latest on the US gas demand spikes

[CNN, Getty]

What you need to know

By Melissa Mahtani, Melissa Macaya, Mike Hayes and Veronica Rocha

  • Gasoline demand is spiking in several states following a ransomware attack that shut down the Colonial Pipeline.
  • In just five states the Colonial Pipeline serves – Georgia, Florida, South Carolina, North Carolina and Virginia – demand was up by a collective 40.1% on Monday, per GasBuddy.
  • A growing list of impacted states have declared a state of emergency to ensure adequate fuel supplies.

Why Americans are panic buying fuel

From CNN’s Matt Egan and Allison MorrowCars line up to fill their gas tanks at a COSTCO at Tyvola Road in Charlotte, North Carolina on May 11.  Logan Cyrus/AFP/Getty Images

Several gas stations along the East Coast ran out of fuel Tuesday as worrieddrivers aggressively filled their tanks. Here’s how we got here:

  • What is Colonial Pipeline? The Colonial Pipeline system spans more than 5,500 miles and transports about 45% of all fuel consumed on the East Coast. It transports 2.5 million barrels per day of gasoline, diesel, jet fuel and home heating oil.
  • What happened: The run on fuel began after a ransomware attack Friday shut down the Colonial Pipeline. The company 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. As of Tuesday, most of the pipeline remained offline.
  • How is this impacting demand for gas? As of 4 p.m. ET Tuesday, 8.5% of gas stations in North Carolina and 7.7% in Virginia didn’t have gasoline, according to outage figures reported by GasBuddy, an app that tracks fuel prices and demand. Georgia, Florida, and South Carolina also reported outages. Even GasBuddy itself reported out website outages as result of “extreme traffic.” 
  • What does this mean for prices at the pump? As demand shot up, the national price at the pump hit $2.985 on Tuesday, the highest level in nearly six years, according to AAA. 
  • How states are responding: Virginia’s governor declared a state of emergency due to fuel shortages. Georgia, North Carolina, Florida and other state governments alsostepped in to ease supply concerns. The Environmental Protection Agency issued an emergency fuel waiver.
  • What should you do? The best thing for car owners to do right now is take a deep breath and don’t rush to fill your tanks unless you have to. A big part of the problem is panic, Tiffany Wright of AAA Carolinas said. “We are our own worst enemy in this situation because we are over-consuming at the pump.”
Cyberattack forces major pipeline to shut down temporarily

Florida issues state of emergency due to disruption of fuel supplies

From CNN’s Rebekah Riess

Florida Gov. Ron DeSantis today declared a state of emergency in the state of Florida due to the cyberattack on Colonial Pipeline and the disruption of fuel supplies. 

Additionally, DeSantis ordered the Adjutant General to activate the Florida National Guard, as needed, to deal with the emergency.

As part of the state of emergency, the secretary of Florida’s Department of Transportation will be allowed to suspend enforcement of the registration requirements for commercial motor vehicles that enter the state to provide fuel, emergency services, or supplies. The secretary will also be allowed to waive the size and weight restrictions on vehicles supporting emergency relief efforts by transporting gasoline, diesel fuel, jet fuel, and other refined petroleum products in Florida.

Colonial Pipeline has manually delivered nearly one million barrels of fuel since cyber attack, company says 

From CNN’s Josh Campbell and Geneva Sands

The beleaguered Colonial Pipeline company says they are making “forward progress” as they work to fully bring their pipeline system back online, according to a new statement Tuesday evening. 

The company says it is working with the US Department of Energy to prioritize delivering inventory to constrained fuel markets that are not already being supplied by alternate delivery mechanisms. 

Since the main pipeline was shut down on Friday following a devastating ransomware cyber attack, Colonial Pipeline said it has worked with shippers to deliver approximately 967,000 barrels of fuel to customers. 

“Consistent with our safety policies and regulatory requirements, Colonial has increased aerial patrols of our pipeline right of way,” the statement said, “and deployed more than 50 personnel to walk and drive ~5,000 miles of pipeline each day.”

Speaking to reporters at the White House on Tuesday, Energy Secretary Jennifer Granholm said Colonial Pipeline indicated it fully expects “to substantially restore operations by the end of this week.”

Florida gas shortages sporadic and limited to northern part of the state, official says

From CNN’s Paul Murphy 

Ned Bowman, the executive director for Florida Petroleum Marketing Association, told CNN that gas station shortages and outages were not widespread, and largely limited to the north of the state.  

Bowman said that he has been in contact with gas station owners and the state government throughout the day. He’s been told that the outages tend to be focused largely in the greater Tallahassee area.  

That’s because that area is largely refilled by the Bainbridge, Georgia, spur of the Colonial Pipeline. He expects many of the stations that are out of gas right now to have gas by tomorrow morning, because they can be supplied from reserves in Jacksonville and Pensacola, Florida. “Supply is tight across North Florida, but we have gasoline,” he told CNN by phone. 

He encouraged Floridians to “take deep breathes” and to not fill up cars needlessly.

Biden officials privately frustrated with Colonial Pipeline’s weak security ahead of crippling cyberattack

From CNN’s Zachary Cohen, Natasha Bertrand, Kevin Liptak and Geneva SandsA Colonial Pipeline station is seen, Tuesday, May 11, in Smyrna, Georgia, near Atlanta.  Mike Stewart/AP

Biden administration officials have privately voiced frustration with what they see as Colonial Pipeline’s weak security protocols and a lack of preparation ahead of the crippling ransomware attack that could have allowed hackers access, officials familiar with government’s initial investigation into the incident told CNN.

Because their investigation is still ongoing, Colonial has yet to share information with the federal government about the vulnerability the ransomware group DarkSide took advantage of to infiltrate the fuel company, according to a top official with the Cybersecurity and Infrastructure Security Agency. The FBI initially told CISA about the attack, not Colonial Pipeline, the agency’s acting director told lawmakers on Tuesday. 

Secretary of Homeland Security Alejandro Mayorkas suggested at a White House briefing Tuesday that the administration is examining Colonial Pipeline’s vulnerabilities. “In cybersecurity, one is only as strong as one’s weakest link. And therefore we are indeed focused on identifying those weak links.”

Colonial Pipeline declined to comment on the suggestion members of the administration are frustrated.

US officials are also working to track down the specific actors responsible for the breach, according to two people familiar with the federal response, a key part of the broader effort to bring the individual hackers to justice.

The internal tensions underscore the stark challenge facing the Biden administration as it continues to grapple with the fallout from the brazen ransomware attack on the country’s critical infrastructure despite having limited access to the private company’s systems and technical information about the vulnerabilities exploited by the hackers. 

“Our understanding is that that is part of the investigation that Colonial’s response vendor is still undertaking. That information has not yet been shared with the US government,” CISA Executive Assistant Director for Cybersecurity Eric Goldstein told CNN in a phone interview.

Colonial Pipeline also did not contact CISA in the wake of the cyberattack, according to a senior cyber official at the agency, Brandon Wales.

“They did not contact CISA directly,” he told lawmakers during a hearing on Capitol Hill Tuesday. “We were brought in by the FBI after they were notified about the incident.”

Still, US officials want to go on the offensive, and believe identifying the individual hackers who targeted Colonial Pipeline is one way of deterring future ransomware attacks. 

“This was a gross miscalculation on the hackers’ part,” said one of the people, who noted that the hackers likely had not anticipated that their attack would lead to the shutdown of the US’ largest refined products pipeline system, spurring emergency White House meetings and a whole-of-government response. 

The hackers operated under the banner of a relatively new ransomware group known as DarkSide, according to the FBI. Because DarkSide effectively operates under a “hacker services for hire” structure, US officials want to identify the specific actors who carried out the attack in the group’s name, the people familiar with the matter said.

Maryland “prepared for all contingencies” following pipeline shutdown, governor says

From CNN’s Melissa Alonso

Maryland Gov. Larry Hogan said Tuesday that the state is “prepared for all contingencies” following the voluntary shutdown of the Colonial Pipeline, according to a series of tweets. “Operators of the pipeline currently anticipate that the disruption is likely to be short-term, we are prepared for all contingencies,” said Gov. Hogan’s tweet.

“Since Saturday morning, when we activated a statewide response, Maryland has been closely coordinating with the federal administration and local jurisdictions,” said the governor.

“We will keep Marylanders informed of any significant impacts on our fuel supply. For now, drivers should proceed as normal,” said Hogan.

These are some of the states that have declared a state of emergency over gas shortages

Customers wait in line to purchase fuel at the Duck-Thru in Scotland Neck, North Carolina, on Tuesday, May 11.  Robert Willett/The News & Observer/AP

Georgia has joined a growing list of states declaring a state of emergency over potential gas shortages.

Shortly after 2 p.m. ET Tuesday, Virginia Gov. Ralph Northam issued a state of emergency declaration “to prepare and coordinate our response to the voluntary shutdown of the Colonial Pipeline due to a cyber-attack,” according to the declaration.North Carolina Gov. 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.

That makes a total of at least three US states implementing emergency measures to ensure fuel doesn’t run dry:

  • Georgia
  • Virginia
  • North Carolina

A number of gas stations along the East Coast are currently out of fuel after drivers aggressively filled up their tanks following a ransomware attack that shut down the Colonial Pipeline, a critical artery for gasoline.

The national price at the pump hit $2.985 on Tuesday, the highest level in nearly six years, according to AAA.

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.

State of emergency declared in Georgia as a result of gas shortage

From CNN’s Rebekah RiessA gasoline station that ran out of gas for sale displays an out of service sign on the pump on Tuesday, May 11, in Atlanta.  Ben Margot/AP

Georgia Gov. Brian Kemp declared a state of emergency on Monday as a result of the gas shortage from the May 7, 2021 cyber-attack on the Colonial Pipeline, according to a release from the Georgia Office of the Attorney General.

The state of emergency will remain in effect through 11:59 p.m. ET on May 15, 2021, the release said.

When the state of emergency was declared, Georgia’s price gouging statutes were also activated.

According to the release, this means that while the state of emergency remains in effect, businesses will not be allowed to charge more for products and services identified by the Governor, including motor fuel and diesel fuel. 

“While we believe this to be a short-term event, we do not want consumers to be taken advantage of,” Attorney General Carr said. “Our office will review all price gouging complaints received to ensure the law is followed.”

These are the measures the Transportation Department is considering to try to ease fuel delivery

From CNN’s Greg WallaceFederal officials said Tuesday they are considering additional ways to ease fuel delivery up the East Coast, addressing outages caused by panic buying in response to the Colonial Pipeline hack. 

The Transportation Department said it is surveying the capabilities of US-flagged ships to transport fuel to costal ports. It expects to complete the survey later on Tuesday, and, if warranted, would consider asking the Homeland Security Department to allow for foreign-flagged ships to make deliveries.

The federal Jones Act generally restricts foreign-flagged vessels from both picking up and delivering goods such as fuel within the country. 

Officials said they are looking for ways to streamline the delivery of fuel from the coast to inland locations by rail.  

Federal highway regulators also expanded the area subject to relaxed trucking restrictions. 

West Virginia now makes the 18th state where hours of service rules – which regulate the length of workday and rest periods for drivers – are waived for truckers handling fuel. 

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