Good day all. This is a breaking story so, as usual, the 72 hour rule applies. It seems that hackers have forced a fuel pipeline company to shut down completely after they invaded their network with ransomeware.
The Pipeline company, Colonial Pipeline, transports about 45% of all the fuels used in the Northeastern United States. This includes gasoline, jet fuel and other stuff. Here are the details from CNBC:
Top U.S. fuel pipeline operator Colonial Pipeline has shut its entire network after a cyber attack, the company said in a statement on Friday.
Colonial’s network supplies fuel from U.S refiners on the Gulf Coast to the populous eastern and southern United States. The company transports 2.5 million barrels per day of gasoline, diesel, jet fuel and other refined products through 5,500 miles (8,850 km) of pipelines. Colonial Pipeline says it transports 45% of East Coast fuel supply.
It seems that they were hit with a ransomware virus, and were forced to shutdown their entire pipeline network as a safety procedure.
The malicious software used in a cyberattack was ransomware, a type of malware that is designed to lock down systems by encrypting data and demanding payment to regain access, two cybersecurity industry sources said.
The company learned of the attack on Friday and took systems offline to contain the threat, it said in the statement. That action has temporarily halted operations and affected some of its IT systems, it said.
I’ve been involved in an emergency shutdown and it isn’t fun. In my case, I was off shift, just getting ready to turn in when I got a call telling me that a virus had gotten into the network and that I was the closest person to the office. I had to go in and shutdown every single server and then go throughout the campus and shut down every desktop computer. That was 36 hours of no sleep for me.
The company has engaged a third-party cybersecurity firm to launch an investigation, and Colonial has contacted law enforcement and other federal agencies, it said.
Frankly, we need to track down who did this and kill them. Not arrest them or try them, just send in a drone and KABOOM! Of course, you can assume that I doubt this was initiated in the United States. (That would mean the drones and Hellfire missiles are out…damnit!) Meanwhile, the markets are trying to figure out how this is going to affect costs of product and futures prices.
Both gasoline and diesel futures on the New York Mercantile Exchange rose more than crude prices during the day. Gasoline futures gained 0.6% to settle at $2.1269 a gallon, while diesel futures rose 1.1% to settle at $2.0106 a gallon.
Longer-term price effects will depend on the amount of time that the lines are shut. If barrels are not able to make it onto the lines, Gulf Coast prices could weaken further, while prices in New York Harbor could rise, one market participant said.
Normally I would say this happening on a weekend would mean they can take the time to fix things, but these pipelines only shutdown for maintenance or in case of potential natural disasters.
Colonial significantly shut down its gasoline and distillate lines during Hurricane Harvey, which hit the Gulf Coast in 2017. During that time, spot Gulf Coast gasoline prices rose to a five-year high, while diesel prices rose to around a four-year high.
In that case, they had to prepare for a major storm and would have shut down everything for a week or more. In this case, provided their Disaster Recovery Planning is up to date and tested, I expect them to turn everything back on by Monday or Tuesday. They’re going to have to wipe and reload all the affected, or potentially affected system and then load the backups. Without question, they are going to lose some data, hopefully it won’t cause to much trouble. Meanwhile expect gas prices to climb.
Thatisall
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