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WATCH NOW: Northam declares state of emergency after cyberattack causes gasoline supply disruptions

WATCH NOW: Northam declares state of emergency after cyberattack causes gasoline supply disruptions

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Virginia Gov. Ralph Northam on Tuesday declared a state of emergency in Virginia because of gasoline supply disruptions caused by a cyberattack on the operator of a key East Coast fuel pipeline.

The emergency declaration came as a gas-buying panic appeared to be spreading in Virginia and other Southeastern states. About 7.7% of the nearly 3,900 gas stations in Virginia were without gasoline on Tuesday, according to GasBuddy.

Long lines formed at some gasoline pumps in the Richmond region along with spotty outages of gas, as people rushed to fill up their tanks.

The disruptions have resulted from the shutdown of the Colonial Pipeline, which runs from Texas to New York and supplies nearly half of the East Coast’s fuel.

A line of cars formed Tuesday afternoon at the Sam’s Club store off of West Broad Street in western Henrico County, where motorists were trying to buy gas at $2.62 per gallon for regular unleaded.

A Costco store on West Broad Street also had a line of drivers waiting to buy gasoline. A Costco employee outside the store told those waiting in line that “everyone is panicking because of the pipeline issue.”

There also were spotty outages of gasoline at other area stores.

Grocery retailer Kroger shut down gas pumps at several Richmond-area locations, including its stores at Willow Lawn in Henrico and Rutland Commons in Hanover County, because of shortages.

“There will be some supply disruptions due to the cyberattack on Colonial Pipeline and spot outages may occur,” Kroger said in a statement Tuesday. “We are doing our best to maintain supplies where we can and looking forward to a return to normal as soon as possible.”

The pumps at the Walmart Neighborhood Market off Sliding Hill Road in Hanover also were out of gasoline.

The same scramble for gas was being seen in other states after the Colonial Pipeline, which moves about 45% of the East Coast’s fuel, was shut down on Friday after its operator’s computers were hit by a ransomware attack, a type of attack in which hackers seize control of an organization’s computer system and demand a ransom payment to unlock it.

The operator of the pipeline, Alpharetta, Ga.-based Colonial Pipeline Co., has said it expects to “substantially restore” operations of the pipeline by the end of this week.

The FBI confirmed that a criminal gang of hackers called DarkSide, believed to be operating in eastern Europe, was responsible for the cyberattack.

The U.S. Environmental Protection Agency has issued a temporary fuel transportation waiver to increase the supply of gasoline, enabling tanker trucks to operate for longer hours.

Northam’s emergency declaration allows state agencies to issue their own waivers as required by the state. The declaration also provides increased flexibility and funding for state and local governments to ensure adequate fuel supply.

“This emergency declaration will help the Commonwealth prepare for any potential supply shortages and ensure Virginia motorists have access to fuel as we respond to this evolving situation,” Northam said in a statement.

Some gasoline retailers were saying Tuesday they still have supplies and were working to avoid shortages.

“There is no question that the Colonial Pipeline outage is becoming a significant event for the entire East Coast as it supplies over 50% of fuel supply to end consumers in many markets that it serves,” said Lori Bruce, a spokesperson for Wawa Inc., a major chain of convenience stores.

“However, I can share that Wawa has had no interruption of supply at its stores in our six states and plans on maintaining supply through this event,” Bruce said.

Henrico-based GPM Investments LLC, which operates the Fas Mart convenience store chain and dozens of others across the country, said Tuesday it has had minimal gasoline shortages. GPM is the seventh-largest convenience store retailer in the U.S. with nearly 3,000 locations.

“As of this morning, we have spot outages in certain areas but nothing widespread at this time,” said Arie Kotler, chairman, president and CEO of Arko Corp. the parent company of GPM. “We are mostly branded fuel and have many brands and supply relationships, so we are able to pull resources from other markets.”

Sheetz, another major convenience store chain, said Tuesday that it is not experiencing any widespread gasoline outages.

“As the shutdown of the Colonial Pipeline continues, our teams at Sheetz are working to address any supply issues at our store locations,” the chain said. “As of now, there are no widespread outages at our stores, although certain grades of gasoline could be temporarily unavailable while our fueling teams replenish supplies. We apologize for any inconvenience caused to our customers and thank them for their patience while we navigate this situation.”

Some gasoline market observers such as the motorist’s club AAA urged people to avoid panic buying because it only exacerbates shortages.

“We realize people are concerned about this ... but they need to think about what they are doing,” said Morgan Dean, a spokesperson for AAA Mid-Atlantic.

Panic buying “creates artificial demand that can lead to shortages and outages,” he said, adding that people should consider fueling up only when their gas tank is a quarter full. He suggested that workers and businesses should also do what so many have done over the past year during the pandemic: Work from home if they possibly can to avoid burning gas by commuting.

The pipeline shutdown “is not so much of a shortage as it is a distribution issue,” Dean said. “There is plenty of fuel on that pipeline but with it shut down, they can’t pull it off of it. Once they get the pipeline back up, all the fuel will be running again.”

AAA on Monday said it forecasts gas prices to climb this week by about 3 to 7 cents per gallon in reaction to the pipeline shutdown.

Average gasoline prices in Virginia increased by 3 cents overnight from Monday to Tuesday to $2.79 per gallon, up from $2.73 a gallon from a week ago.

In the Richmond region, prices jumped 2 cents per gallon to $2.77. That’s up from $2.73 a week ago.

Those prices are more than a dollar per gallon above last year at this time, when the pandemic was keeping huge numbers of people off the roads. Prices already were expected to climb with the approach of the Memorial Day weekend when many people travel.

“We are heading into summer driving season,” Dean said. “We were already expecting that demand was going to drive up prices anyway, so this pipeline shutdown is a bit of a double whammy for drivers.”


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