Colonial Outage – What Happened This Week – Mansfield Energy Corp

Colonial Outage – What Happened This Week – Mansfield Energy Corp

markets
May 15, 2021 by Bobby Chaim
32
On Friday evening, the Colonial Pipeline announced a network outage that required them to shut down their systems. At first, the outage seems like a standard outage – pipelines occasionally undergo maintenance or shutdowns, and markets rarely notice. Although markets lacked clarity at the time, later reports revealed that Colonial paid the ransom within hours
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On Friday evening, the Colonial Pipeline announced a network outage that required them to shut down their systems. At first, the outage seems like a standard outage – pipelines occasionally undergo maintenance or shutdowns, and markets rarely notice.

Although markets lacked clarity at the time, later reports revealed that Colonial paid the ransom within hours of the outage.

CPL could not provide updates on when systems would be restored, only offering a goal of end-of-week for reactivation.

At the same time, consumers began panic buying, stockpiling gasoline in fuel cans, and topping off their cars.

At the fuel marketer level, terminals running dry forced already limited carrier capacity to funnel through certain markets that still had supply, especially in coastal areas.

Georgia temporarily suspended motor fuel taxes, and the IRS announced it would not enforce penalties on using dyed diesel on-road in affected areas.

CPL announced the pipeline reopening on Wednesday night, although capacity was limited and not all segments were online.

Most estimates point to improvements for retail fuel supply by early next week, but the broader bulk fuel market may remain strained due to strained carrier capacity and a large backlog of deliveries.

Indeed, increased fuel exports from Europe have been an ongoing trend this year, which has helped keep the Northeast supplied even as states further south face outages.

This material and any view or comment expressed herein are provided for informational purposes only and should not be construed in any way as an inducement or recommendation to buy or sell products, commodity futures or options contracts.

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