Chevron's Western Australia LNG Plants Hit By Labor Dispute

(RTTNews) - Hundreds of workers at Chevron's LNG plants in Western Australia launched a work stoppage, impacting the global gas market. About 500 employees halted work for up to 11 hours daily, along with specific work bans, due to stalled union negotiations over pay and working conditions.

These strikes are set to continue until Thursday, with the potential for escalated rolling strikes lasting up to 24 hours a day if the deadlock persists. Japan, a major consumer taking 45 percent of the fuel from these facilities, faces the most significant impact.

Australia's substantial LNG exports share makes this situation significant. While Gorgon and Wheatstone (Chevron facilities) don't typically supply Europe, importers like Germany and Britain could face higher prices due to the Australian strike.

Diminished Australian gas shipments may force Japanese customers to seek alternatives, raising spot cargo prices and impacting European LNG and gas prices. European gas prices have already surged by 5.4 percent, exceeding 34 euros per megawatt-hour.

This follows a narrowly avoided strike at a neighboring facility, Woodside Energy's North West Shelf, increasing volatility in European gas prices.

The Russia-Ukraine conflict and reduced Russian gas supply to Europe have made the continent more reliant on global LNG. While concerns exist, it's too early to predict a significant global fuel production disruption due to the Chevron strike. Pressure on both the company and unions to prevent escalation remains considerable, with the Australian government keen to maintain its reputation as a reliable energy supplier.