No, you don’t need to rush out to panic-buy gas, experts say. Here’s why
Drivers shouldn’t rush out to fill up their gas tanks during the Colonial Pipeline shutdown, experts say.
Colonial, which has a 5,500-mile gas pipeline in the eastern United States, temporarily halted operations over the weekend after learning it was the victim of a cybersecurity attack.
Economists say there’s no reason to worry yet about gas shortages or increased prices. But some gas stations across the Southeast were seeing long lines Tuesday, and some were running out of fuel.
Panic buying can often make things worse. Here’s why.
There’s no real fuel shortage
Any shortages seen at individual gas stations are a result of people panic buying, not the Colonial Pipeline shutdown itself, Tiffany Wright, a spokesperson for AAA Carolinas, told The Asheville Citizen Times.
“People hear something and panic,” Wright said, according to the newspaper. “It’s still early, but what I will say is that we do have ample supply even though the Colonial Pipeline is responsible for 45% of the fuel going to the East Coast.”
Experts have said the pipeline would need to remain shut down for several days for consumers to feel significant effects, including increased gas prices.
“I would not expect this to last long enough to make fuel pricing or supply an issue,” Patrick De Haan, head of petroleum analysis at GasBuddy, said on Twitter over the weekend.
“No reason to freak out,” he later tweeted.
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Colonial Pipeline said its goal is to “substantially” restore operations by the end of the week.
“While this situation remains fluid and continues to evolve, the Colonial operations team is executing a plan that involves an incremental process that will facilitate a return to service in a phased approach,” the company said. “This plan is based on a number of factors with safety and compliance driving our operational decisions.”
Andy Lipow, an oil analyst, agreed that prices wouldn’t be affected by a short shutdown but told The Associated Press that if operations are stalled for five or six days, it could cause shortages and price increases — mostly between central Alabama and Washington, D.C.
Panic buying lengthens ‘supply event’
“Reminder to motorists in Colonial’s operating area: rushing out and filling your tank will make the problem much much more acute and likely double or triple the length of any supply event, if it comes to that,” De Haan said on Twitter.
De Haan told the Atlanta Journal-Constitution it will “take days for normal conditions to occur” once the pipeline does restart.
“If motorists hoard gasoline, the problem may stretch for several weeks with continued outages and further pricing impacts,” he said.
Richard Joswick, head of global oil analytics at S&P Global Platts, told the Atlanta Journal-Constitution there “won’t be much of an issue” if the pipeline is restored by Friday.
“If it does drag on for two weeks, it’s a problem,” Joswick said. “You’d wind up with price spikes and probably some service stations getting low on supply. And panic buying just makes it worse.”
Efforts to restore operations
A cybercrime group called DarkSide is behind the attack, the FBI said Monday. The group makes money by encrypting victims’ files and and threatening to publish them online unless a ransom is paid.
Eric Goldstein, executive assistant director of cybersecurity at the Department of Homeland Security’s Cybersecurity and Infrastructure Security Agency, or CISA, said in a statement that the agency is “engaged with the company and our interagency partners regarding the situation.”
On Sunday, The U.S. Department of Transportation’s Federal Motor Carrier Safety Administration issued a regional emergency declaration for 17 states along the East Coast and Washington, D.C., to support “relief efforts related to the shortages of gasoline, diesel, jet fuel and other refined petroleum products” in response to the shutdown.
The declaration creates more flexibility for carriers and drivers, including an exemption from hours of service restrictions for those transporting fuel to the included areas.
President Joe Biden is being “regularly briefed” on the shutdown, and his administration is “continually assessing the impact,” the White House said Monday.
“We are monitoring supply shortages in parts of the Southeast and are evaluating every action the Administration can take to mitigate the impact as much as possible,” the White House said. “The President has directed agencies across the Federal Government to bring their resources to bear to help alleviate shortages where they may occur.”
This story was originally published May 11, 2021 at 12:00 PM with the headline "No, you don’t need to rush out to panic-buy gas, experts say. Here’s why."
