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Strike by Norwegian Oil and Gas Employees Reduces Output

Strike by Norwegian Oil and Gas Employees Reduces Output
Norway oil workers | Image by Reuters

The union in charge of the industrial action told Reuters that the walkout by Norwegian offshore workers, which started on Tuesday, will lower oil and gas production.

The strike is being held amid petroleum prices, with natural gas supplies to Europe being particularly scarce due to Russian export restrictions. Workers are calling for salary increases to offset growing inflation.

“The strike has begun,” said Audun Ingvartsen, the Lederne trade union’s president.

Reiterating that it was monitoring the conflict “closely,” the Norwegian Labour Ministry said if there are exceptional circumstances, it may intervene to end a strike.

According to Equinor, gas and oil production would decrease by 27,500 barrels of oil equivalent per day (boepd) on Tuesday.

The strike was predicted to further reduce the nation’s gas production on Wednesday to 292,000 barrels of oil equivalent per day, or 13% of output, according to Northern Oil and Gas Inc.

According to the lobby, oil production would decrease by 130,000 barrels per day, or about 6.5% of Norway’s production, according to a calculation by Reuters.

A further planned escalation by Saturday may result in up to 25% of Norway’s gas output and almost 15% of its oil production being shut down, Reuters calculates.

Ultimately, Equinor, the operator, decides when to stop producing. Equinor was not immediately available for comment regarding the most recent announced escalation.

Industrial action started at three fields – Gudrun, Oseberg South, and Oseberg East – at midnight local time on Tuesday and was predicted to spread to three others – Kristin, Heidrun, and Aasta Hansteen – starting at midnight on Wednesday.

The Tyrihans field was also expected to close on Wednesday because its product is processed at Kristin.

Reuters reported that Sleipner, Gullfaks A, and Gullfaks C would probably stop producing by Saturday since Lederne members are essential to business operations, which could impact other fields that use those fields to pump their product.

If these fields stopped producing, the output of petroleum and other oil liquids might be reduced by an additional 160,000 boepd and that of natural gas by over 230,000 boepd, a Reuters calculation indicates.

Last Thursday, members of the Lederne trade union rejected a proposed wage deal negotiated by business representatives and union officials.

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