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The colonial oil pipeline resumed operations Wednesday afternoon, allowing oil supplies to reach U.S. states five days after a cyber attack caused a shutdown that precipitated fuel operations at gas stations.
Colonial said it started a restart at about 5 p.m., Eastern Time, but warned that it would take “several days for the product delivery supply chain to return to normal.”
Jennifer Granholm, the U.S. secretary of energy, confirmed the resumption of flows in a tweet, writing that she had just spoken by phone with the chief executive of the Colonial Pipeline company.
The 5,500-mile pipeline system has a capacity for 2.5 m of barrels per day of fuel, and is a critical artery that supplies liquid fuels from oil refineries to east coast states. It was like that close last Friday, after what the FBI said was a rescue attack by a piracy group called DarkSide.
The closure boosted average gasoline prices in the US above $ 3 a gallon on Wednesday, its highest level since 2014. Gasoline futures fell about 1% to $ 2.14 a gallon on Wednesday evening after Colonial announced the restart of the pipeline.
Panic buying in some locations in the southeastern United States caused shortages, with two-thirds of North Carolina’s gas stations reporting that they were out of gas on Wednesday afternoon as motorists were accumulating fuel, according to the provider. GasBuddy data.
“Now, at last, Americans can rest assured that gasoline, diesel and aircraft fuel will begin to flow into the affected areas once again,” said Patrick De Haan, head of GasBuddy oil analysis.
However, returning the pipeline, which previously carried almost half of the fuel used on the east coast, to its previous level of service will take time. Colonial said some of its markets could experience “intermittent service outages during the start-up period.”
“Colonial will move as much gasoline, diesel and fuel for aircraft as safely as possible and will continue to do so until markets return to normal,” he added.
Jeff Lenard, vice president of industry strategic initiatives at NACS, a convenience store trade association, warned that fuel travels at a speed of 3-5 miles per hour along the pipeline (or about 100 miles to the pipeline). day), which means it will take a while for the fuel sent to the Gulf Coast to reach the northeast.
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“I mean, it’s a walking rhythm, so if you want to know how long it will take, walk [from New York] in Houston. You have to wear serious shoes, ”said Lenard.
Richard Joswick, world head of oil analysis at S&P Global Platts, said gasoline stocks in the northeastern U.S. would likely fall to a five-year low as panic buying had exacerbated the deficit caused by the five-day shutdown of the pipeline.
A return to normalcy would take “at least a couple of weeks” on both the East Coast and Gulf Coast refiners that had lost fuel output in recent days, he said.
European fuel exporters had begun chartering ships to increase shipments to the US, while the Biden administration loosened some rules in recent days to allow the shipment or truck of more fuel manufactured elsewhere in the country to the eastern states.
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