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Gas prices highest in 6 years as panic-buying prolongs shortages

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More than 10,000 gas stations remained without fuel Tuesday as states in the Southeast slowly recover from a ransomware attack that crippled the biggest U.S. pipeline earlier this month.

Although Colonial Pipeline resumed operations five days ago, gas prices have continued to edge up after alarmed motorists mobbed pumps following the hack and ahead of the Memorial Day holiday that marks the traditional start of the summer driving season.

Patrick De Haan, head of petroleum analysis at GasBuddy, which compiles data on gas stations using "crowdsourced" reports from consumers, blames most of the empty pumps and price spikes on an overreaction by consumers.

"A rough guess would be 90% of the damage was inflicted by panic-buying and hoarding," De Haan told CBS MoneyWatch. "You're talking about a vast response that absolutely prolonged the outages and made price increases worse." 

The national gas price average on Monday was $3.04, up eight cents from a week earlier and the most expensive in six years. States like Georgia, North Carolina and South Carolina saw prices jump as much as 21 cents in matter of days, according to auto club AAA.

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The situation is improving, however. The number of dry gas stations is down from a peak of more than 16,000 stations five days ago. 

"As the pipeline situation improves, those price increases in the Southeast of over 15 cents a gallon — those will be coming down and pressure the national average down," De Haan said. 

GasBuddy expects the national average for a gallon of gas to dip to $2.98 on Memorial Day, slightly below current prices but $1.02 above the holiday weekend last year, when the pandemic curtailed economic activity and demand for fuel.

De Haan dismissed speculation by some on social media that the shortages and price spikes were orchestrated by Washington insiders. 

"This is nothing to do with politics. It has everything to do with COVID causing the economy and oil production to take two steps backwards," he said. "Now we're at a place where demand has come roaring back."

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