Colonial Pipeline Cyberattack and Potential Repercussions
On May 6, 2021, Colonial Pipeline was forced to shut down the largest gasoline pipeline in the United States, threatening a gasoline shortage that could affect much of the east coast. The cause, a cyberattack launched by Eastern European hackers.
While the attack did not interfere with vital machinery and infrastructure, it did render the company’s internal operations essentially useless. To avoid a significant crisis, the company paid approximately $5,000,000 in ransom.
Despite paying the ransom, Colonial Pipeline took caution in reestablishing production capabilities, leading to panic in the market. If the company could not restart distribution within the week, it could lead to shortages in gasoline and jet fuel across the eastern U.S.
Thankfully, the company was able to restart normal operations and currently distribute millions of gallons per hour. However, despite the relief, many investors and citizens are still concerned, but is there any need for continued anxiety?
Cyberattacks Are Routine Business
While it is unnerving when a ransomware attack affects delicate systems, the goal of these cybercriminals is rarely to affect lasting damage to critical infrastructure. To digital extortionists, the objective is typically financial.
For these individuals, it does not make business sense to damage a company or country permanently. If they cause permanent damage, it lessens the likelihood of future cooperation, meaning they cannot repeat the same attack and expect the same results.
Despite the routineness of these criminals and the expectation or preparation of companies, businesses still do all they can to ensure these attacks do not happen again. Working with government agencies and forensic computer technicians, companies investigate and attempt to locate the criminals responsible for such attacks.
Unfortunately, while paying the ransom is not ideal, it seems to be the quickest and most effective path forward. For now, payment results in quick turnarounds and avoidance of damning shortages or infrastructure damage.
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The Threat of Gasoline Shortages and the Stock Market
There was no real threat to the U.S. gasoline supply. Before the public even caught wind of the attack, the company already paid the ransom and was heading for a full recovery. Unfortunately, the threat of something can also result in a crisis.
Panicked consumers began running to their local gas stations and hoarding supplies. The U.S. Government was forced to make public announcements urging people not to panic-buy and avoid storing gasoline in plastic grocery bags. The rushes on the stations left several businesses with empty tanks. The fact the real threat was over did not seem to matter.
Gas prices and stock market prices barely registered the cyberattack. The increase at the pump was only a few cents more than a typical memorial day surge. However, the threat of overbuying could have severely affected prices had Colonial Pipeline not gotten back online by the end of the week.
For now, there is no threat of a gasoline shortage due to the cyberattack. However, as always, panic and weak cyber defenses remain variable enemies to economic stability.
How did you view the threat of a gasoline shortage? Did you worry about infrastructure collapse, or did you listen to the optimism of the company and government? Leave a comment below to add to the discussion.