Markets were braced for volatility in US petrol and diesel prices on Sunday as the country’s biggest fuel pipeline remained shut down following a cyber attack. The Colonial Pipeline, which carries 45 per cent of the fuel consumed on the US East Coast, was taken offline on Friday, restricting the movement of gasoline, diesel and jet fuel from refineries on the Gulf coast to markets such as Atlanta, Washington and New York.
The disruption comes as Americans begin travelling more with the lifting of coronavirus restrictions, and just ahead of the US driving season, the country’s peak demand months. “We’re realising the gravity of it is maybe worse than what we’d expected,” said Patrick De Haan, head of petroleum analysis at data provider GasBuddy.
De Haan said he expected a “slight impact” when electronic trading resumed on Sunday evening, with prices rising by a few cents. But if the pipeline was not quickly reopened the impact on prices could become more severe in the coming days. Recommended “There’s still a little breathing room, we’re starting to run low on it. But Monday, Tuesday if there’s no news, you know we’re dealing with something fairly significant. ”
The pipeline is the country’s biggest conduit for refined products, spanning more than 5,500 miles from Pasadena, Texas to Linden, New Jersey and New York Harbor, with capacity of 2.5m barrels a day, or almost 15 per cent of total US demand. It serves some of the country’s main transport hubs, including the country’s busiest airport, HartsfieldJackson in Atlanta.
Gasoline demand in areas served by the pipeline rose by about 4 per cent on Saturday compared with the previous week, according to GasBuddy, indicating a degree of panic buying as consumers fretted over the potential for a prolonged outage.