According to Bloomberg data, gasoline prices in New York increased the most in almost eight years to 15 percent in intraday trading, and its premium to crude prices increased 60 percent after the gasoline pipeline explosion and fire in Shelby County, Alabama on Monday, which killed one person and injured several others.
For the second time in two months, Columbia Pipeline shut down its mainline that carries oil products from the U.S. refining center in Houston to the New York Harbor. The first shutdown occurred in September after a section of its Line 1 leaked hundreds of thousands of gallons of gasoline, causing a line shutdown for 12 days and cutting supplies to 50 million Americans in the Southeast.
The possible upcoming gasoline shortages prompted gasoline traders to act fast, booking more tankers for replacement fuel supplies from Europe.
The Southeast is incredibly dependent on pipeline supplies from Colonial Pipeline’s line as there are no refineries between Alabama and Pennsylvania that produce a substantial amount of transportation fuels.
Although precautionary actions are in place after the Monday pipeline blast in Alabama, officials say it is still too early to know just how much the blast will affect the gas supply in the Southeast and along the East Coast.