The Colonial Pipeline Outage: An Important Lesson For US Energy Security

The Colonial Pipeline Outage: An Important Lesson For US Energy Security

Share to Linkedin As cyber-sleuths work to unwind the nefarious hack on the Colonial Pipeline, one of America's most critical pieces of energy infrastructure, the country is getting yet another lesson in the crucial role of energy storage. It is also getting a lesson in the importance of cybersecurity for maintaining our nation's long-term energy security. In April 2020, a lack of places to store oil triggered the short-lived negative WTI price in the depths of the COVID-19 lockdown, contributing to unprecedented market volatility and highlighting the importance of storage capacity for market stability. Just over a year later, the Colonial Pipeline outage is teaching us, yet again, the importance of storage. The Colonial Pipeline system has capacity to move 2. 7 million barrels a day of refined petroleum products from refineries in the Gulf Coast (PADD 3) to the East Coast (PADD 1). The system provides states along the eastern seaboard about half of their total requirements for fuels such as gasoline, jet fuel, and heating oil. For perspective on just how large this is, the East Coast accounts for about one-third of America's total petroleum product consumption. Given the arterial importance of the Colonial Pipeline for the East