Biden Says Colonial Back in Operation But Asks for Patience

President Joe Biden said the Colonial fuel pipeline that was shuttered by a ransomware attack last week is fully operational again, but asked Americans for patience and warned gas stations against price-gouging.

Biden also said that the U.S. government does not believe the Russian government was “responsible” for the attack but that the hackers who perpetrated it are suspected to live in the country.

“Fuel is beginning to flow to a majority of markets” Colonial serves, Biden said Thursday at the White House, “and they should be reaching full operational capacity as we speak.”

But he cautioned Americans that they will not “feel the effects on the pump immediately. This is not like flicking on a light switch.”

Biden Says Colonial Back in Operation But Asks for Patience

The pipeline, he said, “had never been fully shut down in its entire history.” Restarting it is “going to take some time, and there may be some hiccups.”

He said he expects a regional “return to normalcy” by this weekend, but warned gas stations in the meantime not to excessively raise prices.

“Nobody should be using this situation for financial gain. That’s what the hackers are about, not us,” he said.

Biden faces pressure to show his administration is responding to the hack that caused Colonial Pipeline Co. to shutdown its East Coast distribution system, sending average gasoline prices to more than $3 a gallon for the first time in six years.

The company resumed shipments late in the day Wednesday and on Thursday morning said deliveries had begun to most of the pipeline’s markets.

Some gas stations ran dry from Florida to Virginia after Colonial was forced to take systems offline on May 7. In parts of the U.S. South, three of every four gas stations had no fuel as of Wednesday, while in Washington, D.C., cars were lining up for blocks as they waited to fill up.

Optimism that the situation will return to normal sent gasoline futures down as much as 3.5% in New York trading.

In response to the shortage, the administration temporarily eased century-old U.S. shipping requirements on Thursday so a single foreign tanker it didn’t identify could transport gasoline and jet fuel to the East Coast.

A White House official said Thursday that the exemption applied to one tanker but other waiver requests are under consideration. The waiver was necessary to get around the Jones Act that restricts shipping between American ports to be conducted by vessels built and crewed in the U.S.

The administration has taken other steps to blunt the crisis, including waiving some gasoline requirements and empowering 10 states to allow heavier-than-normal truck loads of fuels.

The disruption underscored how vulnerable America’s fuel supply system has become in the wake of increased attacks on energy infrastructure by hackers over the past few years. Hackers are increasingly attempting to infiltrate essential services such as electric grids and hospitals.

Colonial paid nearly $5 million to hackers on Friday, Bloomberg News reported, contradicting reports earlier this week that the company had no intention of paying a ransom to regain control of its systems.

Biden said Wednesday the attack demonstrated the need for U.S. investments in education to improve the nation’s cyber defenses. He’s proposed $4 trillion in spending on infrastructure, social welfare and education programs.

He called for Congress to confirm Chris Inglis, his nominee for national cybersecurity director, a new position Congress created earlier this year.

©2021 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.