Oil prices fall sharply after recovery US pipeline

Oil prices have fallen to 4% on Thursday. Analysts point to the restoration of crude oil supply, which did not start in recent days. Recently, Colonial Pipeline‘s software in the east, the largest in the United States, was hacked and the oil supply for pumping stations was disabled.

The hackers claimed to have stolen data from the company and blocked the pipeline remotely through the software. They demanded money in exchange for restarting the oil bank.

According to Bloomberg, Colonial Pipeline eventually paid the Eastern European attackers $5 million, unlike the company itself reported. Colonial wouldn’t have gone into the blackmail.

Supplement

Since the attack, petrol prices rose to $3 per gallon, the highest price since 2014.

From Virginia to Florida, gasoline was rationed. The failure of the pipeline six days ago caused an increasing shortage of refined fuels at the pump, additional supply from other sources was insufficient.

According to oil suppliers, rapid replenishment was difficult due to a shortage of oil tankers. Millions of motorists were hit.

For the first time in long times, North America had queues of cars waiting at petrol stations.

Extra security

The Colonial Pipeline, 8850 km long, accounts for more than 100 million barrels of crude oil in transport per day, while computer-controlled oil pumping through this tube system resumed at the end of Wednesday, after a series of software protections were introduced implemented.

According to the US government, the delivery will have returned to full strength by the end of this weekend.

The price of Brent oil went down 2.5% Thursday afternoon to $67.70 a barrel. American WTI oil dropped 2.2%. Other fuels also fell by around 2.5% in price.

Analysts also point to the rising inflation rate, which is already reflected in the fuel bill, which has cooled demand.

Eugen Weinberg, head of commodity strategy at Commerzbank, sees a ‘changing mood’ in the markets, fearing incidents, while the oil market is in balance, he says.

According to US Transport Secretary Pete Buttigieg, the cyber attack on the pipeline, presumably of Russian origin, signals that hundreds of producers in the country need to cooperate more closely with the central government in order to resist such attacks.