European Gas Prices Rise As Union Deadlines Approach

European gas prices rose 9.8% on Monday after unions gave Woodside 7 days notice of strike action on Sunday if there isn’t an agreement by the end of Wednesday, according to The Australian. The results of Chevron’s union ballot are due on August 24. Prices peaked at the start of European trading at EUR42.90 but spent most of the day below EUR40 to finish at EUR39.98.

• Industrial action is to include stoppages of up to four hours and refusal to unload non-essential cargo. But unions will make sure gas for the Australian market will not be disrupted.
• While most of Australia’s gas is shipped to Asia, a reduction in supply heading into the northern hemisphere winter would mean that Asian users would be competing with Europe for non-Russian sources. North Asian LNG prices are up 16.6% this month. European storage has reached its target of 90% capacity but markets remain jittery around industrial relations on Australia’s Northwest Shelf.
• While European gas prices are up 47.4% this month, at around EUR40, they remain low. In August last year, they peaked around EUR300.