Economists: Overstocking on gas will only make pipeline shutdown worse
The Colonial Pipeline, providing nearly half of the gas to states from Texas to New Jersey, has been closed for three days over a cyber-attack with a Russian criminal group suspected to be to blame.
JACKSONVILLE, N.C. (WITN) -A pipeline problem is threatening to gut gas supplies in The East.
A cyber-attack of Colonial Pipeline’s main line, the country’s largest pipeline supplying nearly half of the fuel to states from Texas to New Jersey, shut down its operations, worrying economists and people at the pump.
“I probably burn about $120 a week,” said Larry Young, a landscaper from Jacksonville. “I hope it doesn’t hurt us that much. It’s high enough as it is this time of the year.”
And economists say prices were only predicted to get higher as we neared the pick-up of summer travel, but that was before the attack that cybersecurity experts say they believe a Russian criminal group is to blame. National security experts say they expect the group to offer a ransom to get the line back open, but it’s unclear how much.
“Don’t be surprised. You’ll probably start to see some yellow tape on gas pumps,” said Patrick De Haan, the head of petroleum analysis at GasBuddy. “It’s all in the hands of motorists. If everyone goes out to fill up, which is unnecessary, prices are going to make an even bigger jump. And if they do that, too, we’re going to be talking about several weeks of gasoline outages.”
Several of the company’s smaller lines are open, and they are aiming to get their main line open by the end of the week, they said.
But if they don’t, it could have significant economic consequences the longer it goes on.
“The storage capacity is pretty full right now,” said Rick Niswander, a professor of accounting at East Carolina University. “So, in the short-term, it’s not going to hurt that much. But the longer it goes, the more it’s going to hurt.”
Gov. Roy Cooper signed an executive order Monday to waive specific size and weight requirements for gas trucks, lifting some roadblocks for fuel to get to stations while the major pipeline can re-open.
“If it’s a few more days, it’s not that big of a deal,” said Niswander. “If it’s a week or two, it’s a big deal.”
Even with a surge, experts say they expect gas prices to bounce back to regular levels at some point. Hopefully, in time, they said, so that it won’t be too much for drivers to handle.
“I don’t want to price myself out of business,” said Young. “And I don’t want them to start to decide to cut their lawns.”
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