Washington — The US has issued a Jones Act waiver to a single shipper to move gasoline and jet fuel from the Gulf Coast to the East Coast as the Colonial Pipeline restarts, the Department of Homeland Security said May 13.
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Homeland Security Secretary Alejandro Mayorkas said he approved a "temporary and targeted waiver requested by an individual company," without naming the company or giving any volume details.
Colonial said late May 12 that it had started the process to restore full operations, which would take several days.
A ransomware attack May 7 forced a shutdown of the entire pipeline system that supplies about 45% of the gasoline and diesel consumed on the East Coast.
Southeast states faced severe outages at gasoline stations this week as panic-buying exacerbated lower refined product deliveries from Colonial.
Energy Secretary Jennifer Granholm said May 13 that Colonial told the government "that the restart of the pipeline went well overnight."
"This should mean things will return to normal by the end of the weekend," Granholm said on Twitter.
White House spokeswoman Jen Psaki said that the administration would stay in close contact with Colonial. "As supplies return to normal, we will also continue our whole-of-government effort to mitigate any challenges, including the swift steps we've taken to boost gas supply in affected states," she said early May 13.
S&P Global Platts Analytics called the restart an "encouraging development" but said ongoing panic-buying, even in areas not served by the pipeline, would continue to exacerbate the impact of the supply shortfall.
Platts Analytics expects Northeast gasoline inventories to still fall below five-year lows this week before rebounding, and Gulf Coast refiners face containment issues due to gasoline product stocks as they wait for the full pipeline restart.
"Full recovery for both the East Coast and Gulf Coast will take a couple of weeks at least as there are lags and limits for all shipping options," Platts Analytics said.
USAC gasoline stocks, at 64.6 million barrels the week ending May 7, were 3% below the five-year average, US Energy Information Administration data shows.
Before the restart announcement, Colonial was already transporting fuel on many of the pipeline's laterals, and its Line 4 segment of the pipeline from North Carolina to Maryland was being operated manually.
The pipeline has taken an additional 2 million barrels from refineries for deployment upon Colonial's restart.