Biden says pipeline back in operation after Colonial pays hackers

US president asks for patience as the pipeline regains full service

Motorists line up for fuel at one of the few remaining gas stations that still has fuel in Arlington, Virgina, on May 13, 2021. AFP

US President Joe Biden said the Colonial fuel pipeline that was shut by a ransomware attack last week is fully operational again, but he asked Americans for patience and warned petrol stations against price-gouging.

Mr Biden said the US government did not believe the Russian government was “responsible” for the attack but the hackers were thought to live in the country.

“Fuel is beginning to flow to a majority of markets and they should be reaching full operational capacity as we speak,” he said.

But Mr Biden said Americans would not “feel the effects on the pump immediately. This is not like flicking on a light switch".

"It's going to take some time and there may be some hiccups,” he said.

He said the pipeline had never been fully shut down before.

Mr Biden said he expects a regional “return to normalcy” by this weekend, but warned petrol stations not to excessively raise prices in the meantime.

“Nobody should be using this situation for financial gain. That’s what the hackers are about, not us,” he said.

Mr Biden is under pressure to show his administration is responding to the hack that caused Colonial Pipeline to shut down its East Coast distribution system, sending average petrol prices to more than $3 a gallon for the first time in six years.

The company resumed shipments late on Wednesday and on Thursday morning said deliveries had begun to most of the pipeline’s markets.

Some petrol stations ran dry from Florida to Virginia after Colonial was forced to take systems offline on May 7.

In parts of the US South, three of every four petrol stations had no fuel as of Wednesday, while in Washington DC, cars were lining up for blocks as they waited to fill up.

Optimism that the situation would return to normal sent gasoline futures down as much as 3.5 per cent in New York trading.

In response to the shortage, the administration temporarily eased century-old US shipping requirements on Thursday so a foreign tanker could carry petrol and jet fuel to the East Coast.

A White House official said on Thursday that the exemption applied to one tanker but other waiver requests were under consideration.

The waiver was necessary to get around the Jones Act, which restricts shipping between American ports to be conducted by vessels built and crewed in the US.

The administration has taken other steps to ease the crisis, including waiving some petrol requirements and empowering 10 states to allow heavier-than-normal truck loads of fuel.

The disruption showed how vulnerable America’s fuel supply system has become after increased attacks on energy infrastructure by hackers over the past few years.

Hackers are increasingly trying to infiltrate essential services such as electric grids and hospitals.

Colonial paid nearly $5 million to hackers on Friday, Bloomberg News reported, despite reports this week that the company had no intention of paying a ransom to regain control of its systems.

The company paid the hefty ransom in untraceable cryptocurrency within hours of the attack.

A source said US government officials were aware that Colonial made the payment.

When they received the payment, the hackers provided the operator with a decrypting tool to restore its disabled computer network.

The tool was so slow that the company continued to use its own back-ups to help restore the system, a source said.

A representative from Colonial declined to comment, as the National Security Council.

Colonial said it began to resume fuel shipments about 5pm eastern time on Wednesday.

The hackers, who the FBI said are linked to a group called DarkSide, specialise in digital extortion and are believed to be in Russia or Eastern Europe.

Mr Biden said on Wednesday that the attack demonstrated the need for US investments in education to improve the nation’s cyber defences.

He has proposed $4 trillion in spending on infrastructure, social welfare and education programs.

Mr Biden called for Congress to confirm Chris Inglis, his nominee for national cyber-security director, a position Congress created earlier year.