Economic Development Now

What happened over the weekend?

On the evening of Friday, May 7, the Colonial Pipeline Company fell victim to a ransomware attack that forced the shutdown of its system, which stretches 5,500 miles from Houston to Linden, N.J. According to its records, the company is responsible for carrying 45 percent of the East Coast’s fuel supplies to a 14-state region, which translates to 100 million gallons of fuel per day. As soon as the attack was identified, all pipeline operations were stopped in order to mitigate damages. This was the first time the company had ever halted all operations at once.

Who is responsible?

The FBI has determined that the attack was carried out by a hacker organization known as DarkSide. DarkSide claims to be a “Robin Hood”-type group that only formulates attacks on large corporations in an effort to essentially donate part of their successful ransoms to charities, and is “apolitical”. President Biden and investigation teams have determined that the group is likely based somewhere in Eastern Europe, but as of now there is no evidence tying the group to Russian federal agencies or government. 

What is happening now?

We are currently seeing the amount of panic that an infrastructure shock can cause and how it makes the problem worse than it needs to be. Like early in the COVID-19 pandemic when toilet paper shortages were rampant, gas stations in the Southeastern United States are running dry. While things are being done to mitigate the gas shortage, such as White House policy changes that include an Hours of Service waiver and allowing higher tank truck weight limits on highways, panic buying is causing upwards of 65 percent of all gas stations in North Carolina to be empty as of Wednesday, May 12, according to data acquired by GasBuddy. State and national gas price averages are also rising. For example, prices in North Carolina went up by 6 cents from Tuesday to Wednesday based on data from AAA.

As of Wednesday evening, parts of the pipeline system have been manually restored. It will take a few days for the system to return to normalcy, and some areas may experience service interruptions during the restart.

Implications for the future

The main concern moving forward is the resilience of the system. The Texas Interconnection failure earlier this year highlighted the need for resilience and mitigation strategies for U.S. infrastructure systems. The ransomware attack demonstrates that the risk for cyberattacks is at an all-time high in an increasingly virtual world.

With cyberattacks accumulating over the past year, President Biden signed an executive order on Wednesday evening which will remove barriers of information sharing between government and private businesses, establish a Cybersecurity Safety Review Board, and implement other important measures.