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Europe’s energy woes escalated on Tuesday after Norwegian oil and gas workers went on strike, shutting down three fields in the North Sea and causing an immediate spike in natural gas prices.
Norway’s state-owned energy company Equinor said it had closed the fields after some of its workers went on strike following a pay dispute.
The three fields produce the equivalent of about 89,000 barrels of oil per day, more than 30% of which is natural gas, Equinor said in a statement. Norway was Europe’s second-biggest source of natural gas last year, after Russia, according to Eurostat data, and the cut comes at a critical time for the region.
Any further decline in Norway’s output could deal a major blow to efforts to replenish gas reserves ahead of winter, as well as raise the risk of an energy shortage.
Germany, the region’s largest economy, has already declared a “gas crisis” and warned that it cannot rule out the introduction of rationing to get through the winter. News of the strike sent natural gas prices up 5% to 172 euros per megawatt hour, according to data from the Intercontinental Exchange. This is the highest price since early March in the days following Russia’s invasion of Ukraine.
On Wednesday, Norwegian workers will strike again, which will result in the shutdown of three more fields, Equinor said. These fields produce the equivalent of about 330,000 barrels of oil per day, of which almost 80% is natural gas.
Another strike is planned for Saturday, which Reuters estimates could shut down about a quarter of Norway’s gas output and 15% of its oil output. Equinor said the impact of the third day of strikes “is not yet clear”.
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