Benchmark natural gas prices on the European market rose on Monday as workers at some liquefied natural gas (LNG) production and transport facilities in Australia prepare to strike if an agreement is not reached within Wednesday’s wage negotiations, Bloomberg reports.
On Monday morning, at the gas hub TTF in Amsterdam, where the reference prices in Europe are set, the futures quotations for natural gas with delivery in the next month were increasing by 18%, up to 42.90 euros for a Megawatt- hour, according to Agerpres.
The strike could begin on September 2 if Woodside Energy Group Ltd, the operator of the liquefied natural gas export plant, does not offer a proper deal, unions said at the weekend. And the employees of the Chevron Corp plants started voting last week to decide on the initiation of a protest movement.
The possibility of supply disruptions in Australia, which could affect 10% of global LNG exports, kept European traders on edge this month.
Anxiety on the energy market has increased, even though the natural gas storage capacities in the EU are already 90% full, well ahead of the deadline set to reach this level – November 1 – the European Commission announced last week.
On August 16, the level reached 1,024 TWh, or 90.12% of storage capacity, equivalent to more than 93 billion cubic meters (bcm) of natural gas.
In 2022, the European Union invested significantly in liquefied natural gas (LNG) imports and adopted regulations to increase storage capacities to avoid supply shortages following cuts in Russian gas imports following the invasion of Ukraine. Among these regulations is the establishment of a mandatory EU-wide target of filling storage facilities at 90% by November 1 each year.
Last year, Europe imported 62 billion cubic meters of Russian gas through pipelines, a level 60% lower than the average of the previous five years, European Commission data shows.
This year, deliveries from Russia to the EU would fall to 25 bcm, assuming flows through the TurkStream pipeline and through Ukraine are in line with December 2022 volumes, the International Energy Agency (IEA) forecast.