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Pipeline outage causes U.S. gasoline supply crunch, panic buying

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Gas stations from Florida to Virginia began running dry and prices at the pump rose on Tuesday, as the shutdown of the biggest U.S. fuel pipeline by hackers extended into a fifth day and sparked panic buying by motorists.

The administration of U.S. President Joe Biden projected that the Colonial Pipeline, source of nearly half the fuel supply on the U.S. East Coast, would restart in a few days and urged drivers not to top up their tanks.

“We are asking people not to hoard,” U.S. Energy Secretary Jennifer Granholm told reporters at the White House. “Things will be back to normal soon.”

Colonial was shut on Friday after hackers launched a ransomware attack – effectively locking up its computer systems and demanding payment to release them – and the company has said it is hoping to “substantially” restart by the end of this week.

But the outage, which has underscored the vulnerability of vital U.S. infrastructure to cyberattacks, has already started to hurt.

About 7.5% of gas stations in Virginia and 5% in North Carolina had no fuel on Tuesday as demand jumped 20%, tracking firm GasBuddy said. Unleaded gas prices, meanwhile, neared an average $2.99 a gallon, its highest price since November 2014, the American Automobile Association said.

In an effort to ease the strain on consumers, Georgia suspended sales tax on gas until Saturday, and North Carolina declared an emergency. The U.S. federal government, meanwhile, has loosened rules to make it easier for suppliers to refill storage, including lifting seasonal anti-smog requirements for gasoline and allowing fuel truckers to work longer hours.

Granholm said there is not a shortage but a gasoline supply “crunch” in North Carolina, South Carolina, Tennessee, Georgia and Southern Virginia, regions that typically rely on Colonial for fuel.

Driver Caroline Richardson said she was paying 15 cents more per gallon than a week ago as she refueled at a gas station in Sumter, South Carolina. “I know some friends who decided not to go out of town this weekend to save gas,” she said.

DARKSIDE HACK

The strike on Colonial “is potentially the most substantial and damaging attack on U.S. critical infrastructure ever,” Ohio Senator Rob Portman told a Senate hearing on cybersecurity threats on Tuesday.

The FBI has accused a shadowy criminal gang called DarkSide of the ransomware attack. DarkSide is believed to be based in Russia or Eastern Europe and avoids targeting computers that use languages from former Soviet republics, cyber experts say.

Russia’s embassy in the United States rejected speculation that Moscow was behind the attack. President Joe Biden a day earlier said there was no evidence so far that Russia was responsible.

A statement issued in DarkSide’s name on Monday said: “Our goal is to make money, and not creating problems for society.”

It is unknown how much money the hackers are seeking, and Colonial has not commented on whether it would pay.

“Cyber attacks on our nation’s infrastructure are growing more sophisticated, frequent and aggressive,” Brandon Wales, acting director of the Cybersecurity and Infrastructure Security Agency (CISA), said on Tuesday at a Senate hearing on the SolarWinds hack that hit companies and government agencies.

GOVERNMENT STEPS IN

The Environmental Protection Agency issued a waiver on Tuesday that allows distributors to continue supplying winter fuel blends through May 18 in three Mid-Atlantic states to help ease supplies.

North Carolina and the U.S. Department of Transportation, meanwhile, relaxed fuel-driver rules, allowing truckers hauling gasoline to work longer hours. North Carolina and Virginia have both declared a state of emergency.

The U.S. has also started the work needed to enable temporary waivers of Jones Act vessels in response to the cyber attack – something that would allow foreign flagged fuel carriers to move from one U.S. port to another, the Transportation Department said.

There are growing concerns that the pipeline outage could lead to further price spikes ahead of the Memorial Day weekend at the end of this month. The weekend is the traditional start of the busy summer driving season.

Gulf Coast refiners that rely on Colonial’s pipeline to move their products have cut processing. Total SE trimmed gasoline production at its Port Arthur, Texas, refinery and Citgo Petroleum pared back at its Lake Charles, Louisiana, plant, sources told Reuters.

Marathon Petroleum is “making adjustments” to its operations due to the pipeline shutdown, a spokesman said without providing details.

While the pipeline outage is having big short-term consequences in some regions, some experts believe the longer term impact will be small.

“Markets will go crazy, but two weeks later no one knows it happened,” said Chuck Watson, director of research at ENKI, which studies the economic effects of natural and other disasters.

(Reporting by Laura Sanicola, Stephanie Kelly and Devika Krishna Kumar; Additional reporting by Nandita Bose; Editing by Paul Simao, Cynthia Osterman and Grant McCool)

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Trudeau called for concerted G7 approach to China

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Prime Minister Justin Trudeau led a Group of Seven discussion of China on Saturday and called on leaders to come up with a unified approach to the challenges posed by the People’s Republic, a source said.

G7 leaders – who together control about $40 trillion in economic clout – reached broad alignment on building a concerted approach to China, the source with knowledge of the discussions told Reuters.

“Trudeau’s message today was that we really need to work to build a consensus on a unified approach to the challenges that China presents all of us,” the source said. “We have to show solidarity as a group and show action as a group as well.”

“There is a general alignment” at the G7 on China, the source said.

 

(Reporting by Guy Faulconbridge; editing by Kate Holton and Michael Holden)

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Ukraine’s president thanks G7 nations for support

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Ukraine’s president, Volodymyr Zelenskiy, thanked the G7 group of wealthy industrial nations on Sunday after it voiced support for Kyiv and called on Russia to withdraw troops and weapons from near Ukraine’s eastern border.

Leaders of the United States, Britain, Canada, France, Germany, Italy and Japan reaffirmed their backing for Ukraine and called on Moscow to stop its destabilising behaviour in a communique issued after a three-day summit in the UK.

“Commend the unwavering support by #G7 states in the Summit’s communiqué,” Zelenskiy wrote in Twitter.

“Grateful to leaders for the continued support for Ukraine’s independence & sovereignty & the call to the aggressor to withdraw troops from Ukraine’s borders & Crimea. #Crimea is Ukraine!”

Kyiv hopes pressure from Western allies could force Moscow to withdraw tens of thousands of its troops deployed in April near Ukraine’s eastern border and in Crimea, which Russia annexed in 2014.

The West expressed concern about the worsening of the situation in the eastern region of Donbass, where Ukrainian troops fought Russian-backed forces in a conflict that Kyiv said had killed 14,000 people since 2014.

 

(Reporting by Natalia Zinets; Editing by Peter Cooney)

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Thousands march in support of Muslim family killed in truck attack in London, Ontario

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Thousands of people marched on Friday in support of a Canadian Muslim family run over and killed by a man driving a pick-up truck last Sunday in an attack the police described as a hate crime.

The four victims, spanning three generations, were killed when Nathaniel Veltman, 20, ran into them while they were out for an evening walk near their home. A fifth family member, a 9-year-old boy, survived.

People in London, Ontario marched about 7 kilometers (4.4 miles) from the spot where the family was struck down to a nearby mosque, the site close to where Veltman was arrested by police.

Some carried placards with messages reading ‘Hate has no home here’, ‘Love over hate.’ Similar events were held in other cities in Ontario, Canada‘s most populous province.

“The best part was not just the numbers … but the diversity of the people coming from every single community in London, coming together for this cause,” said 19-year old college student Abdullah Al Jarad at the march.

The attack sparked outrage across Canada, with politicians from all sides condemning the crime, spurring growing calls to take action to curb hate crime and Islamophobia.

Veltman made a brief court appearance on Thursday and will return to court on Monday. He faces four charges of first-degree murder and one of attempted murder.

Canadian Prime Minister Justin Trudeau has called the killings a “terrorist attack” and vowed to clamp down on far-right groups and online hate.

 

(Writing by Denny Thomas; editing by Richard Pullin)

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