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Colonial Pipeline shuts down Line 1 and 2

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East Coast May Face Fuel Shortages After Storm Disrupts Major Pipeline

Colonial Pipeline plans to shut down a key line that supplies gasoline to the South due to storm-related refinery shutdowns and Harvey's effect on its facilities west of Lake Charles, Louisiana.

Colonial Pipeline delivers more than 100 million gallons of gasoline, home heating oil, aviation fuel and other refined petroleum products per day, according to their website.

Almost a year ago Colonial suffered a break in its Line 1 in Georgia, interrupting fuel supplies to the East Coast.

The American Automobile Association attributes the increase in gas prices throughout the country to Hurricane Harvey; on Monday, the national average for a gallon of gas was four cents higher.

With the closure of a part of a key pipeline Thursday creating the potential to drive them higher, average gas prices climbed 5 cents across the country and in Virginia between Wednesday and Thursday in the wake of Hurricane Harvey, which made landfall in Texas last week and continues to drench parts of Louisiana, Arkansas and MS as a tropical depression. In Columbia, gas prices have steadily increased from $2.09 per gallon on August 28 to about $2.21 today. Fuel deliveries will be intermittent and depend on its ability to receive supplies from refineries and terminals.

Their 5,500-mile long pipeline starts in Houston and ends at the New York Harbor.

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The facilities in Lake Charles, Louisiana of Colonial Pipeline are temporarily out of service due to the hurricane. Line 1 had been operating at a reduced capacity since Harvey hit.

AAA says about 19 percent of the Gulf Coast's refining capacity is offline, representing about 3 million barrels a day of gasoline production.

The news sent USA gasoline prices RBc1 surging to a two-year high of $1.9350 a gallon, while margins RBc1-CLc1 jumped to a two-year high of $24.38 a barrel, as Asia markets opened.

With several refineries on the Texas coast shutdown and severely damaged from flooding, the company has no timeline for when operations of the pipeline will resume. And in the massive underground interstate system that is the nation's pipeline network, the Colonial Pipeline is I-95.

"AAA expects this to a noticeable yet short-term spike in gas prices", the organization said in a news release.

"Given the unprecedented flooding in the city of Port Arthur, it remains uncertain how quickly the flood waters will recede, so we can not provide a timeline for restart at this time", the company said.

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