What happens when you combine a pandemic, rising insurance premiums, and a cyberattack on the largest fuel supplier for the Eastern Seaboard? Let’s all say it together: “unprecedented times!”
If you’re in a city such as Atlanta, you may notice long lines at gas stations or even stations that are completely out of fuel. As of the morning of May 13th, over 50% of gas stations in the Atlanta area were completely out of fuel, according to Fox 5 Atlanta. It also seems our neighbors to the south are seeing a similar pattern, as Florida Gov. Ron DeSantis declared a state of emergency and activated the National Guard for logistical support. Many governors in the Eastern United States are also following suit.
The largest factor of this crisis, reminiscent of the 1970s gas lines during the Middle East oil embargo, is a ransomware attack on the Colonial Pipeline perpetrated by the Russian-based hacking team called DarkSide. The Colonial Pipeline supplies nearly 45% of the fuel for the East Coast and the attack from May 7th was still causing major disruptions a week later.
This fuel shortage strikes as issues stemming from the COVID-19 pandemic were already affecting the nation’s fuel supply. In April of 2020, demand for gas dropped due to the COVID-19 shutdowns, falling 50% from the previous year. This sharp fall in demand of April 2020, caused the trucking industry to lose approximately 88,300 jobs, according to the U.S. Bureau of Labor Statistics.
From a combination of the pandemic, rising insurance premiums, and the recent cyberattack, many supply chains will be seeing delays and tightened capacity over the next few weeks. When looking for the silver lining of this entire scenario, look to the sharp decrease in fuel demand from 2020. While this decrease in demand for fuel temporarily hurt the U.S. economy, many U.S. storage facilities were able to stockpile fuel, which just so happened to come in handy for this unforeseen pipeline shutdown.
While it seems one problem certainly fed another, the Colonial Pipeline will be resolved at some point in the near future. The lasting effects of this ransomware attack, however, will leave many curious about the future.
Director of Marketing & Media, C.L. Services