September 22, 2023 [Oil Price]- The benchmark natural gas prices in Europe and the UK dropped early on Friday after Chevron and trade unions settled a labor dispute which led to the unions calling off the strikes at two large LNG export facilities in Australia.
The front-month futures at the Dutch TTF hub, the benchmark for Europe’s gas trading, dropped by 1.8% to $40.87 (38.39 euros) per megawatt (MWh) as of 7:26 a.m. GMT on Friday.
The equivalent UK wholesale gas price was also down, by 3.3%.
European prices have seen a lot of volatility in recent weeks, due to the strikes in Australia, lower pipeline flows from Norway because of maintenance, and glitches at large U.S. LNG export facilities.
On Thursday alone, Europe’s natural gas prices fell early in the day as signs emerged that supply risks from Australia and Norway had eased. But prices shot up later in the day to settle higher as reports emerged that gas flows to Sabine Pass LNG, the biggest liquefaction facility in the United States, had plunged by 18%.
On Friday, the end of the labor dispute saga in Australia sent prices lower as risks to disruption subsided from the two Chevron plants, Gorgon and Wheatstone, which account for over 5% of global LNG supply.
The Offshore Alliance trade union has called off the strike at the Chevron LNG facilities after Australia’s labor market regulator mediated a settlement between the parties.
The strike began on September 8 after they failed to reach an agreement with Chevron about working conditions and wage demands.
“The Offshore Alliance will now work with Chevron to finalise the drafting of the agreement and members will soon cease current industrial action,” the union said, as quoted by Reuters.
Separately, European gas prices also weakened after the huge Troll gas field in Norway resumed production and is ramping up flows to Europe after a long period of maintenance.
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