The impact of the Colonial Pipeline outage has the area’s gas supply drying up at the pump.
Like other businesses that rely on the pipeline in the area, a company that runs gas station and convenience store operations in the Cape Fear region is feeling the effects.
Fayetteville-based Holt Oil Co., which operates the Holt C-Store convenience store brand and has an office in Wilmington, was continuing to monitor the situation Tuesday.
“We’re expecting the disruption to last several weeks,” said Hannah Holt, Holt Oil's marketing and operations director. “I know that today, I believe all of our stores are out of gas. We might have some premium gas left. And we don’t know when we are going to get another delivery.”
As of Tuesday, none of the company’s suppliers could provide them with gasoline, she said, adding that if the company does get a delivery, it will be less than half of what the Holt C-Stores usually get for a weekly supply.
Colonial Pipeline Co. was the victim of a cybersecurity attack that prompted the company to take certain systems offline to contain the threat, temporarily halting pipeline operations, according to the company's media statement Saturday.
In a company update
at 7:50 p.m. Monday, Colonial stated it was continuing to work to restore pipeline operations and was forming a plan for a phased return to service.
Officials with New Hanover County said Tuesday that the county is monitoring the temporary shutdown of the Colonial Pipeline and fuel supply in the area. The county is working to be sure county and emergency services remain uninterrupted, they said in a news release.
“New Hanover County is prepared to respond to this fuel shortage, and has plans in place to ensure services continue,” New Hanover County Board of Commissioners Chair Julia Olson-Boseman said in the release.
“Considering Colonial Pipeline has stated they expect the pipeline to be reopened by the end of the week I am not issuing a state of emergency at this time, but should the situation change, we may choose to do so. I encourage residents to avoid panic purchasing fuel because that drives the shortage, and to conserve fuel by limiting non-essential outings," she added.
Gov. Roy Cooper on Monday declared a state of emergency in response to the situation.
Gas prices are also starting to rise across the state. In Wilmington, the current gas prices were nearly $2.81 a gallon on Tuesday compared to nearly $2.73 a week ago, and $1.80 a year ago, according to the latest figures from AAA.
The Colonial Pipeline outage is expected to continue to threaten gas pump prices, and AAA is forecasting prices to climb more this week in light of the shutdown of the pipeline, which supplies "approximately 45% of all fuel to the East Coast," AAA officials said in a news release Monday.
“The impact of this pipeline outage will vary regionally,” said Tiffany Wright, spokesperson for AAA – The Auto Club Group in the Carolinas, in the release. “The outage will have implications on both gasoline supply and prices. The longer it's offline, the larger the impact on the East Coast.”
Holt said an increase in the price of gasoline is most likely due to the fact that suppliers are going to have to travel to other states to pick up gas.
"As you can imagine, that is going to drive up our cost of doing business. Right now, we're just trying to get it anywhere we can," Holt said.
“It’s a day-by-day, hour-by-hour scenario for us right now,” Holt added. “When we do get supplies, it's going to be allocated, which is going to be a problem because people are going to be rushing around trying to find gas. It will be like the [gas] shortage of the hurricane [Florence] experience.”
The Holt family operates 15 C-store locations, nine of which are in the tri-county area.
Holt noted the shortages aren’t just showing up at the gas stations and affecting the travelers that use the gas; they're also having an influence on the logistics industry.
“If the grocery stores can’t get their trucks on the road to deliver product, that’s going to be a problem,” Holt said.
Officials with Wilmington-headquartered MegaCorp Logistics, an asset-based logistics firm, said that the Colonial Pipeline situation is directly affecting its customers with pickups and deliveries on the East Coast.
"There already has been a supply and demand issue within the trucking industry," said Katie Braskett, marketing director with MegaCorp Logistics, in an email. "For example, on average, one in four loads that are tendered and ready to go are unable to be picked up on time due to lack of available trucks (of course, not when MegaCorp commits to a shipment, due to the strong relationships we have with our vetted Carrier Partners). Additionally, this is the 11th week in a row with the tender index above 15,000, a number we weren’t even close to in pre-COVID times."
The tender index is an index of electronically tendered freight volumes on a given day, Braskett explained.
"A tender is a load offer from a shipper to a trucking company that is sent electronically. These are actual loads and are transmitted a few days before they are scheduled to be picked up. This is the most current and reliable indicator of market demand," she said.
The prior record in volume during pre-COVID times was before Thanksgiving 2019 at 10,707, she said.
"This is impacting the already ballooned cost of truckload shipments because carriers can pick and choose which pickups and destinations they want to go to at the moment due to the market and they do not want to come to an area where there is a potential to be suck with no fuel, thus affecting their business and further skyrocketing shipping costs to these areas.
"This will impact the produce industry the most and will likely raise prices to the end consumer. Most produce has to be on a refrigerated truck and is time sensitive so it has to be picked up, no matter the cost," Braskett said.
Commercial airlines are also making changes to flights in response to the situation. At the Wilmington International Airport (ILM), however, flight schedules were not affected as of Tuesday afternoon, officials said.
“Thus far our airlines have not been impacted and they have received no information that indicates a local impact. I have spoken to the FBO (Modern Aviation) and their GM tells me that he does not expect any impact at this time as they continue to receive their daily deliveries and have sufficient fuel to provide to the airlines,” said Gary Broughton, ILM’s deputy airport director, in an email Tuesday morning.
He added, “Customers should contact their airline for updates on upcoming travel."