The prices of European natural gas prices has been on free fall as signs that a labor dispute at Australia’s biggest liquefied natural gas export plant will be resolved, taking away apprehension and fears about one of three possible strikes in the key exporting nation. Benchmark futures witnessed a sharp fall as much as 18% on Thursday.
Wholesale gas prices in Europe have gone down because it seems a planned strike at Australia’s biggest liquefied natural gas (LNG) plant won’t happen after all.
Fears of global LNG supply disruption ease as Woodside energy averts strike
The possibility of a walkout at Woodside Energy’s North West Shelf plant had caused worries about global LNG supplies and had raised gas prices.
But on Thursday, the company reached an initial agreement with unions that could prevent the strike. As a result, the EU and UK benchmark gas prices have fallen nearly 33% from their highest point on Tuesday.
Employee representatives at the North West Shelf plant showed support for the initial agreement, and a vote is scheduled to finalize the deal.
The strike concerns were due to workers potentially walking out on September 2nd, which could have led to higher prices.
The LNG plant in Australia is one of the largest exporters globally. The potential strike added uncertainty to the energy market and could have contributed to a rise in energy prices for consumers.
Woodside stated that it will continue working with unions to complete the agreement and expressed progress in resolving key workforce issues during recent talks.
While workers at other LNG facilities in Australia have endorsed potential strike actions, analysts believe the risk of disruption to supplies is not very high.
