What does the Colonial Pipeline cyber attack mean for Texas’ economy?

Business

AUSTIN (KXAN) — A prolonged shutdown of the Colonial Pipeline — shuttered after falling victim to a ransomware attack on Sunday — could send ripple effects through the Texas economy, according to energy experts.

Colonial Pipeline

Stretching 5,500 miles from Texas to New Jersey, the Colonial Pipeline is the largest in the United States and carries nearly half of the east coast’s fuel supply. While the price and supply of fuel remained stable in Texas on Monday, a build-up of supply could shake the state economy.

Patrick De Haan, a petroleum analyst with GasBuddy, said oil producers could have to slow or stop production in the coming days, potentially hurting oil prices over the next several weeks.

“There could be some sizable bumps in the road until it all smooths out,” De Haan said, adding that gas price may even decrease in Texas over the coming days. “A lot of this relies on the wheels in the cog moving and now we have one of the biggest wheels frozen in position.”

Any shutdown of the Colonial Pipeline will have a global impact on supply and prices, Michael Webber, a professor of the Energy Institute at the University of Texas, told KXAN. Equally concerning, though, is the threat posed by cyber attacks to critical infrastructure.

In February, inadequate preparation for extreme cold weather led to a near-collapse of the Texas energy grid. Webber said Texas energy producers and policymakers have, once again, been sent a clear signal.

“We’re more vulnerable than we like to admit,” Webber said. “It’s an infrastructure question and it’s time for us to invest with the level of importance that it requires.”

The average American utility faces 260 cyber attacks every week, according to data from Check Point Research.

Joel Hollenbeck, a cybersecurity expert at Check Point Software Technologies, said the energy sector is always going to be a prime target for thieves.

“They target energy, specifically, because they know the stakes are high,” Hollenback said. “When the stakes are high, it forces the hand of the organization to oftentimes pay the game and pay the ransom.”

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