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Experts say cyberattack on US pipeline is a wake-up call

FILE - In this Sept. 8, 2008 file photo traffic on I-95 passes oil storage tanks owned by the Colonial Pipeline Company in Linden, N.J. A major pipeline that transports fuels along the East Coast says it had to stop operations because it was the victim of a cyberattack. Colonial Pipeline said in a statement late Friday that it “took certain systems offline to contain the threat, which has temporarily halted all pipeline operations, and affected some of our IT systems.” (AP Photo/Mark Lennihan, File)

NEW YORK — The shutdown of a vital U.S. pipeline because of a ransomware attack stretched into a third day Sunday, with the Biden administration saying an “all-hands-on-deck” effort is underway to restore operations and avoid disruptions in gasoline supply.

Experts said that gas prices are unlikely to be affected if normal operations resume in the next few days but that the incident — the worst cyberattack to date on critical U.S. infrastructure — should serve as a wake-up call to companies about the vulnerabilities they face.

The pipeline, operated by Georgia-based Colonial Pipeline, carries gasoline and other fuel from Texas to the Northeast. It delivers roughly 45% of fuel consumed on the East Coast, according to the company.

Commerce Secretary Gina Raimondo said Sunday that this kind of incident “is what businesses now have to worry about,” and that she will work “very vigorously” with the Homeland Security secretary to address the problem of cyberattacks, calling them a top priority for the administration.

“Unfortunately, these sorts of attacks are becoming more frequent. They’re here today. We have to work in partnership with business to secure networks to defend ourselves against these attacks,” she said on CBS’ Face the Nation.

She said President Joe Biden was briefed on the attack.

“Its an all-hands-on-deck effort right now,” Raimondo said. “And we are working closely with the company, state and local officials to make sure that they get back up to normal operations as quickly as possible and there aren’t disruptions in supply.”

Ransomware attacks are typically carried out by hackers who lock up computer systems by encrypting data and then demand a large ransom to release it. Colonial Pipeline has not said what was demanded or who made the demand and offered no immediate update Sunday.

David Kennedy, founder and senior principal security consultant at TrustedSec, said that once a ransomware attack is discovered, companies have little recourse but to completely rebuild their infrastructure, or pay the ransom.

“Ransomware is absolutely out of control and one of the biggest threats we face as a nation,” Kennedy said. “The problem we face is most companies are grossly underprepared to face these threats.”

The cyberextortion attack presents a new challenge for a Biden administration still dealing with its response to major hacks from months ago, including a huge breach of government agencies and corporations for which the U.S. sanctioned Russia.

Colonial Pipeline said that the ransomware attack Friday affected some of its information technology systems and that the company halted pipeline operations.

The Alpharetta, Georgia-based company transports gasoline, diesel, jet fuel and home heating oil from refineries on the Gulf Coast through pipelines running from Texas to New Jersey. Its pipeline system spans more than 5,500 miles, transporting more than 100 million gallon a day.

Debnil Chowdhury at the research firm IHSMarkit said that if the outage stretches to one to three weeks, gas prices could begin to rise. The last time there was a major outage, because of a broken pipeline in 2016, gas prices went up after about 10 days.

“I wouldn’t be surprised, if this ends up being an outage of that magnitude, if we see 15- to 20-cent rise in gas prices over next week or two,” he said.

The private cybersecurity firm FireEye said it has been hired to manage the investigation.

The Justice Department has a new task force dedicated to countering ransomware attacks.

Such attacks, mostly by criminal syndicates operating out of Russia and other safe havens, reached epidemic proportions last year, costing hospitals, medical researchers, businesses, state and local governments and schools tens of billions of dollars.

Average ransoms paid in the U.S. jumped nearly threefold to more than $310,000 last year. The average downtime for victims of ransomware attacks is 21 days, according to the firm Coveware, which helps victims respond.

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Bajak reported from Boston. AP Writers Alan Suderman in Richmond, Virginia, and Martin Crutsinger and Michael Balsamo in Washington contributed to this report.

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