Southeast US fuel deliveries resume by pipeline, water

Emergency waterborne fuel deliveries and a slowly restarting critical pipeline network began refilling southeast US fuel supplies cut off by a nearly week-long shutdown of the Colonial Pipeline system.

US regulators last night approved waivers of the Jones Act to allow gasoline and jet fuel deliveries from internationally-flagged vessels moving between US ports. The movements will speed deliveries of fuel to regions drained by the shutdown of the 2.5mn b/d Colonial Pipeline network late last week.

The company began restarting more segments of that network at 5pm ET yesterday, restoring fuel flows from the US Gulf coast through the southeast and into the New York Harbor market.

Pipeline restart efforts "went well overnight" US energy secretary Jennifer Granholm said in a tweet this morning.

"This should mean things will return to normal by the end of the weekend," Granholm said.

Operators shut the pipeline network on 7 May to stop a ransomware infection from spreading to critical pipeline systems. Colonial moves fuel from suppliers in Texas, Louisiana and Mississippi through a 5,500-mile (8,851km) system.

Most of Florida receives waterborne fuel supplies. But southeastern states have fewer supply alternatives to the pipeline network. Though federal data showed fairly average fuel inventories for the area heading into the shutdown, the outage sparked panic buying quickly draining retailers across the region.

The Jones Act requires US-flagged and crewed vessels move commodities including fuel between US ports. But low transportation fuel demand over the past year had idled a third of the fleet authorized to move gasoline, diesel and jet fuel. Last night's federal waiver will allow cheaper, more widely available internationally-flagged vessels to transport replacement supplies as the pipeline restores capacity.

By Elliott Blackburn