Ripple effects of the U.S. Colonial Pipeline shutdown

Yahoo Finance’s Stephanie Asymkos breaks down the extent of the gas shortage and the rise in gas prices.

Video transcript

ALEXIS CHRISTOFOROUS: All right, just a few moments ago-- the oil markets closed, and it was an up day for WTI. We saw it rallying more than 1% on the day. Taking a look at that oil close right now, it looks like crude going to finish at a little over $66 a barrel. Meantime, gas prices continuing to soar.

We now have the national average in this country above $3 a gallon for regular. And that is the highest we've seen in about seven years. We have got drivers up and down the East Coast trying to fill up their gas tanks following that ransom attack-- that ransomware attack that shut down the colonial pipeline, which is, of course, a critical artery for gasoline.

We see this panic buying. We saw it happening in the South. It has now moved up to parts of New Jersey and Pennsylvania. Joining us now for more on this is Stephanie Asymkos, who has been taking a look at the gas situation. What can you tell us, Stephanie?

STEPHANIE ASYMKOS: Right now, Alexis, the best thing that I can describe what's happening in the Southeast is hysteria. And it seems to be concentrated in North Carolina, where newly-released data from Gas Buddy indicates 2/3 of the state is completely without gas. And nearly half of the gas stations in Virginia and Georgia are without gas.

And as you said, we're seeing these shortages bleed and extend to neighboring states and just going straight up the East Coast. And it's happening very quickly, because we're not even a week out from the cyber-attack. And to your point, gas is over $3 a gallon now, but the pipeline destruction is not the sole culprit.

The pricing is actually colliding with a truck driver shortage of people who are qualified to transport gas. And then we're also just a couple of weeks away from Memorial Day, which is when gas prices historically take off and get a little bit higher.

KRISTIN MYERS: So, Stephanie, what has the consumer reaction been? I feel like previously when we've heard about these gas shortages, you've seen long lines at the pump as people almost start hoarding gasoline out of fear that they're not going to be able to get any more in the coming days and weeks. Are we seeing that kind of behavior happening now as well?

STEPHANIE ASYMKOS: Absolutely. And perhaps the irony of all of this is that before this temporary pipeline shutdown, gasoline reserves were flush. And right now, these shortages are entirely made, and it's becoming a self-fulfilling prophecy, because drivers are causing the shortages by hoarding. So the experts that I talked to say if we all stop doing that, everything would be OK otherwise.

A year ago, we talked about hoarding toilet paper, and that certainly caused a problem. But there's definitely a difference between hoarding toilet paper and hoarding gasoline or diesel in your home or car. Gasoline is highly flammable, combustible. And improperly stored, it poses a huge threat to the people and animals in your home and your neighbors. So I definitely want to encourage everyone to listen to the experts and just stop buying unnecessary amounts of gas to not add delays to something that's entirely avoidable.

ALEXIS CHRISTOFOROUS: Yeah, we also saw Governor Phil Murphy of New Jersey come out and tell folks, we have sufficient supply of gasoline. Please stop hoarding and trying to have this run on the gas stations. We also know that the Colonial pipeline should be back up to 100% in just a matter of days.

So is the issue at all about supply at this point? Or is it the anticipation that supply is going to be an issue, Stephanie?

STEPHANIE ASYMKOS: I think that people are just really burned from the pandemic last year, and they don't want to be caught flat-footed on something that's a commodity that's running out. So I'm not really sure what everyone's motivation is, but I do know that it's completely flawed logic to just drive around aimlessly looking for gas and then filling more up if you don't exactly need it, because you're just burning your tank at that point.

ALEXIS CHRISTOFOROUS: All right, Stephanie Asymkos, thanks for keeping an eye on it for us.