Pipeline leak jolts gas prices in Southeast

Nathan Bomey, USA TODAY5:28 p.m. EDT September 16, 2016

(Photo: Justin Sullivan, Getty Images)

Gasoline prices are creeping up in several states in the Southeast due to a prolonged pipeline outage .

Several states, including Alabama, Georgia, South Carolina, North

Carolina and Tennessee, are particularly susceptible to increases, GasBuddy.com petroleum analyst Patrick DeHaan said.

"This is quickly snowballing into a larger issue," DeHaan said Friday in an interview. "Some stations are starting to run out, though it's probably still a small amount."

The governors of Alabama and Georgia declared states of emergency temporarily lifting certain fuel-transportation regulations to ensure adequate supply for communities after the leak in Shelby County, Ala., shut down the line.

Still, there were sporadic reports of stations in Georgia increasing prices by up to 30 cents per gallon overnight, DeHaan said. The state had the largest average overnight increase from Thursday to Friday at 3.1 cents per gallon to $2.146, according to GasBuddy. That still trailed the national average of $2.186 per gallon.

"What had seemed likely to be a short-lived disruption in an already well-supplied market may now cause localized disruptions in some eastern and southeastern states," JBC Energy analysts said Friday in a research note.

Colonial Pipeline said 6,000 barrels of gasoline were accidentally released on Sept. 9 from a pipeline that ferries the commodity from Gulf Coast refineries to refineries on the Eastern seaboard.

The leak was contained in a mine water retention pond. The company said Thursday afternoon that it expects repairs to extend into next week but that the company had implemented contingency plans to carry gasoline on a separate pipeline that usually carries diesel, jet fuel and home heating oil.

"Given its current repair schedule and the implementation of our contingency plans, the company does not expect disruptions to be long term," Colonial said in a statement.

Still, the pipeline is the "largest artery" supplying gasoline in several Southeast states, DeHaan said. Storage sites are quickly depleting pent-up supplies to fulfill demand.

Without a quick fix, "Monday, Tuesday could be ugly" at the pump, he said.