Pain at pump won't include fuel shortages in Michigan, experts say
Gas prices may be rising slightly locally but don't look for shortages at the pump in Michigan after a major pipeline shutdown on the East Coast, experts said.
The 5,500-mile Colonial Pipeline, a major source of fuel supply for states from the Southeast to the East Coast, was forced to shut down May 7 after a cyberattack by hackers. The disruption fed long lines at gas stations in the Southeast and spurred panic buying. The nation’s largest fuel pipeline restarted operations Wednesday.
The Michigan Public Service Commission "is closely monitoring the situation on the East Coast but doesn't anticipate shortages of automotive fuel in Michigan," said Dan Scripps, the group's chair. "We are also continuing to monitor price impacts, particularly as gasoline prices typically increase this time of year as we head towards Memorial Day and the summer driving season."
Since Michigan isn’t directly serviced by the Colonial Pipeline, its direct impact is "essentially panic buying that is affecting supply at certain gas stations," said Adrienne Woodland, a representative for AAA Michigan. "AAA is advising everyone to be calm and continue their normal refueling patterns … Right now Michigan is set to have access to plenty of gasoline."
Detroit area prices had jumped about 14 cents a gallon to $2.93 by May 5 before the Colonial pipeline shut down most of its operations on Saturday, according to GasBuddy.com, a firm that tracks real time gas prices across the country. The price has since risen to $2.97 a gallon in Detroit on Thursday, according to the website.
“The Colonial mishap has not had a material impact throughout most of the country except in that area" that includes Virginia, North Carolina, South Carolina and Georgia, said Patrick DeHaan, head of petroleum analysis at GasBuddy.
DeHaan agreed Michigan and most states will have plenty of fuel. There will be about seven to 14 days of "headaches if you need fuel" in Georgia, North Carolina, South Carolina or Virginia, he tweeted Thursday morning.
"The situation will definitely take time and slowly improve due to a high number of outages and higher number of stations to refuel," DeHaan said.
Mark Griffin, president of the Michigan Petroleum Association, which includes 120 independent wholesales that own, operate or deliver fuel to about 4,800 gas stations statewide, said members are watching for a potential impact but likely won't face any since they connect to a different pipeline network.
"This particular pipeline is not necessarily going to affect our supply or price right away," Griffin said.
The national average price of gasoline on Wednesday passed the $3 per gallon mark for the first time since 2014, according to GasBuddy.com.
“While this is not a milestone anyone wants to celebrate, it’s a sign that things are slowly returning to normal,” De Haan said in a Wednesday statement. “In this case, rising gas prices are a sign Americans are getting back out into the world — attending baseball games, going to concerts, taking a road trip — basically staying anywhere but at home.
"This summer may see some blockbuster demand for fuel as well, as Americans find it very challenging to travel internationally, leading many to stay in the confines of U.S. borders, boosting some weeks to potentially record gasoline demand.”
While the hacking of the Colonial pipeline has raised fears of copycat attacks around the country, DeHaan said Michigan wouldn't be hurt much if one of its pipelines were similarly targeted successfully.
Michigan has the Marathon refinery in Detroit, he noted. if the Wolverine pipeline were closed in West Michigan, he said, refineries in northwest Indiana are a one-hour to two-hour drive away.
The Southeast has very little energy infrastructure, so the Colonial shutdown had a uniquely large impact on the region, DeHaan said.
Scripps said the commission's cybersecurity staff conducts annual security meetings with Michigan electric utilities and plans to begin similar meetings with gas utilities this year.
"While we know of no related threats to Michigan utilities or pipeline operators, Michigan's energy companies are on heightened alert and have increased their monitoring and security measures, and the commission has been in regular communication on these efforts," Scripps said.
Michigan's association members, Griffin added, would instead be affected by a shutdown of the Line 5 pipeline in the Straits of Mackinac.
"We’re very concerned about what potentially could happen to Line 5," Griffin said. "We wouldn't want to experience the same kind of chaos folks have experienced in the South with the Colonial Pipeline shutdown. We’re watching the scenario as it unfolds because to us, that’s kind of a learning scenario of what we might be faced with if Line 5 would be shut down."
In Michigan, AAA expects more than 1 million residents to take a trip during the holiday weekend. That’s almost a 57% increase from 2020, when fewer than 700,000 residents traveled due to the pandemic, the group reported this week. That's still below pre-pandemic numbers but encouraging, it said.
"The Memorial Day travel holiday weekend is set to rebound," Woodland said.