We Ran Out of Fuel on the East Coast

Matt Posky
by Matt Posky

With the Colonial Pipeline shut down due to last week’s ransom hacking, the Eastern United States has found itself running out of fuel. The line was shut down on Friday as a precaution and we’ve since learned that it’s not going to be reopened until this weekend — and maybe not even then.

While this has left some of us with fuel prices creeping aggressively toward $3 per gallon, other parts of the East Coast have seen panic buying and legitimate outages. But it’s hardly surprising when you consider the Colonial Pipeline is the country’s largest. Turning off the tap has ramifications and they’re manifesting all across the coast, though the situation appears to be substantially worse in southern states.

Local outlets are reporting stations without any fuel to speak of in places like Florida, Georgia, Virginia, and Maryland. While prices have held below the $3 mark, panic buying seems to have tapped out more than a few stores. Ironically, West Texas Intermediate crude had plummeted this time last year. Barrels were trading at a negative $35 per barrel as the lapse in demand created by pandemic lockdowns resulted in a surplus so huge there was nowhere to keep the excess volume.

Before you freak out, the American Automobile Association (AAA) has predicted a national price jump well below 10 cents over the next week. That gives you plenty of time to top off the tank and keep it there if prices skyrocket through the summer months or outages become commonplace. Of course, the AAA is also urging against panic buying (even though it’s already started in some areas) because that typically makes the issue worse for everyone and things are already going to be difficult to predict. Even if the pipeline was reactivated today at full capacity, it could be a couple of weeks before fresh oil reaches all impacted states.

“This shutdown will have implications on both gasoline supply and prices, but the impact will vary regionally,” AAA spokesperson Jeanette McGee said in a statement. “Areas including Mississippi, Tennessee and the East Coast from Georgia into Delaware are most likely to experience limited fuel availability and price increases, as early as this week. These states may see prices increase 3 to 7 cents this week.”

On Monday, Colonial said it wants to get most of its operations back online by the weekend. But that’s not going to be enough to dodge shortages and price hikes. GasBuddy estimated roughly 7 percent of gas stations located in Virginia have already run out of fuel. Neighboring states are doing better, but places like Georgia and Florida have also seen stations dry up. North Carolina even issued a state of emergency pertaining to the situation in the hopes that it would help maintain its existing supply.

“While our mainlines (Lines 1, 2, 3 and 4) remain offline, some smaller lateral lines between terminals and delivery points are now operational,” Colonial explained over the weekend. “We are in the process of restoring service to other laterals and will bring our full system back online only when we believe it is safe to do so, and in full compliance with the approval of all federal regulations.”

Pulling back to look at the bigger picture, American’s are likely to see some of the highest fuel prices witnessed since 2014. While it doesn’t sound good, it doesn’t appear to be an impossible to manage crisis until you’ve read what Bloomberg has to say. The outlet took a snapshot of the coastal plight and appears to have only run with quotes from people enduring (or convinced of) the worst. While fairly bleak, it’s a good resource if you want to learn more about the pipeline hackers, gas stations that have run out of fuel, or read about what the oil industry and government are attempting to accomplish.

From Bloomberg:

Federal environmental regulators are waiving rules that bar the sale of conventional gasoline in areas where reformulated fuel is required. They also will permit the sale of gasoline that doesn’t satisfy requirements meant to help combat smog. The waivers apply to Maryland, Virginia, Pennsylvania and Washington, D.C., through May 18.

In New Jersey, closely held Bolkema Fuel Company began topping off its stockpiles as soon as word spread of the Colonial outage.

“There is a panic going out, you know, when you hear something like this,” said Vice President John Bolkema. “I called in an extra driver and said, just run a few extra loads. Let’s pump up the inventory and wait this out.”

His supplier increased prices at least three times on Monday as other businesses sought to stock up, and Bolkema’s commercial clients are asking for extra deliveries to avoid running low.

“It’s going to be catastrophic,” John Patrick, chief operating officer of Liberty Petroleum LLC, told the publication. “Governors should declare a state of emergency and ask people chasing tanker trucks to gas stations to stay home. School buses stay put.”

Emergency shipments of gasoline and diesel from Texas are already on the way to southeastern cities via tanker trucks. But a large amount of the supply will be going to service military bases that were also being impacted by the pipeline shutdown. Oil will also be shipped in from overseas but that isn’t something the United States could maintain without prices becoming astronomical and inland refineries will still have a tough time until the pipeline is restored.

[Image: Michael Vi/Shutterstock]

Matt Posky
Matt Posky

A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.

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  • Jeff S Jeff S on May 16, 2021

    Lou_BC--I believe many get so emotional over the pipeline and the US being energy independent that they cannot see the business end of pipelines and refining. The US does not have a shortage of oil but less refinery capacity and pipeline shutdowns like the hacking of the Colonial Pipeline cause shortages of gasoline, diesel, and other refined products. The timber industry is similar in that there is no shortage of timber but more like a limited number of mills that can process timber into wood products and these mills are for the most part controlled by a limited number of companies and corporations. Those who own timberland and sell to the corporations who own the mills are not the ones making the big money more like those who own and control the mills.

  • MyerShift MyerShift on May 23, 2021

    Just part of the liberal plan to have us paying as much as the Europeans do for fuel as their grip of control tightens more and more around our collective necks until we lose our freedom, mobility, self-respect, and good way of life. How dare Americans enjoy a high standard of living. It's not right!

  • Richard Poore Sure, as the article itself notes (hence my ire) California has mandated that all new vehicles sold in state be EV by 2035. They require EV or hybrid by 2026. Since the author admits to this mandate it seems that the article title is clickbait... was really hoping that there was some sort of changes in the CA position since the state is sorely behind on where they need to be with charging stations for this sort of requirement.
  • VoGhost When will Audi eliminate the fake, oversized grills that impede aerodynamics?
  • Kelley It's about time! I was so discouraged to see those poor Chevy Bolts stuck at the charging station receiving level 2 speeds after 80%, it was ridiculous. It would be nice if EA would had more level 2 chargers, also, at the same locations for people to top off above 80% on the fast chargers.
  • Tane94 Carmela Harris is supportive of EV adoption, so government incentives will be continuing under her watch.