Stay ahead of market conditions. Learn more about the ongoing fuel shortage in the Southeast below.
Key Takeaways
- The Colonial Pipeline supplies regions from Houston to New York City with gasoline, diesel fuel and jet fuel.
- The pipeline hack that caused the shutdown is leading to panic buying in the Southeast region.
- The national average for a gallon of regular gas rose two cents on Tuesday. In several states, including GA, fuel has risen by three to ten cents a gallon. This price jump is comparable to when hurricanes disrupt refinery and pipeline operations.
- GasBuddy, a service that tracks gas prices, reported that more than 40% of gas stations in GA, VA and SC are without fuel, while NC has more than 65%.
- The company that operates Colonial Pipeline has said that it hopes to restore operations by the end of the week. Experts believe the impact should remain minimal as long as the artery is fully restored by that timeline.
Shipper Notes
- As long as operations are restored by the weekend, the impact to domestic supply chains should be minimal.
- If conditions worsen:
- The impact will likely be similar to a widespread storm where businesses are closed until fuel supplies are restored.
- Carriers will be more likely to reject loads inbound to or on lanes passing through the impacted areas. This would also cause a shortage of capacity in the region that would make conditions worse when demand ramps back up after the fact.
- A shutdown would create a backlog of demand in the region causing increasing tightness in an area already light on capacity.
- This short supply of fuel could pose challenges for a larger workforce involved in the supply chain. If gas stations continue to run out of fuel, warehouse workers, dock workers, and others will likely struggle to get to work.
This update was created on Wednesday May 12th, 2021.
