Crude oil prices soared on Monday following the cyber attack that forced the US to shut down critical fuel supply pipelines and highlighted the vulnerability of oil infrastructure.
Brent crude oil, which increased 1.5% or 38 cents last week, rose 0.6% or 38 cents per barrel at 0443 GMT to $ 68.66. West Texas Intermediate (WTI) futures rose 34 cents per barrel, or 0.5%, to $ 65.24 after gaining more than 2% last week.
Pointing to the gravity of the situation, the White House was closely involved with Colnial’s pipeline to help survive a ransomware attack that forced the largest oil pipeline operator in the US to shut down its supply network to the crowded eastern states.
Colonial’s pipeline network is the source of almost half of the US East Coast’s fuel supply, and its 2.5 million barrels of gasoline and other fuels a day as an artery. All pipelines had to be shut down following a cyberattack involving ransomware on Friday.
US gasoline prices rose nearly 2% on Monday, while heating oil rose more than 1%.
It is unclear who carried out the attack, probably a professional hacker, cybercriminal group.
Colonial is said to have closed main fuel lines on Sunday, but some smaller lines between terminals and delivery points are currently operational. It was not said when the network could return to full operational capacity.
Described as an important “infrastructure,” the long downtime will cause gasoline retail prices to skyrocket before the peak summer travel season, a potential blow for US consumers and the economy.
The biggest unknown is what the process will be. However, the longer it takes, the higher the refined product prices will be.
Critical US energy infrastructure must strengthen protections against hacking attacks. The Energy Ministry said it is monitoring possible impacts on the country’s energy supply.
