WH Says Pipeline Hack Hasn’t Translated Into Supply Shortages, Yet

WH Says Pipeline Hack Hasn't Translated Into Supply Shortages, Yet WH Says Pipeline Hack Hasn't Translated Into Supply Shortages, Yet Homeland Security Advisor and Deputy National Security Advisor Dr. Elizabeth Sherwood-Randall speaks about the Colonial Pipeline cyber attack during the daily press briefing at the White House on May 10, 2021 in Washington, DC. (Drew Angerer/Getty)

By Fran Beyer | Monday, 10 May 2021 02:58 PM

The White House said Monday a cyberattack on Colonial Pipeline, the largest oil supplier in the Northeast, hasn’t yet resulted in supply shortages, The Hill reported.

At a briefing by White House homeland security adviser Elizabeth Sherwood-Randall, reporters were told officials are monitoring for potential disruptions.

“Right now there is not a supply shortage. We are preparing for multiple possible contingencies … and considering what additional steps may be useful to mitigate any potential disruptions to supply," she said.

Colonial Pipeline, which transports gasoline and other fuel through 10 states between Texas and New Jersey, delivers about 45% of fuel consumed on the East Coast.

On Sunday, the company said its main pipeline remained offline, but that some smaller lines were operational. The company has not said when it would completely restart the pipeline.

"The time of the outage is now approaching critical levels and if it continues to remain down we do expect an increase in East Coast gasoline and diesel prices," Debnil Chowdhury, IHS Markit executive director, said at the Monday briefing, according to the Associated Press.

The last time there was an outage of this magnitude was in 2016, he said, when gas prices rose 15 to 20 cents per gallon. But the Northeast had significantly more local refining capacity at that time, potentially intensifying any impact.

The FBI on Monday said the ransomware attack had been carried out by a criminal gang known as DarkSide, which cultivates a Robin Hood image of stealing from corporations and giving a cut to charity, the AP reported.

In response, the Biden administration loosened regulations for the transport of petroleum products on highways as part of an "all-hands-on-deck" effort to avoid disruptions in the fuel supply.

If the pipeline outage persists, the industry may want to turn to barges to transport fuel, but that could require a waiver of the Jones Act, a U.S. maritime law that requires products shipped between U.S. ports to be moved by American-flagged ships, the AP reported.

The pipeline utilizes both common and custom technology systems, which could complicate efforts to bring the entire network back online, analysts at Third Bridge told the AP.