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Norwegian oil and gas workers have started a strike, reducing production

Norwegian oil and gas workers have started a strike, reducing production
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OSLO, July 5 (Reuters) – Norwegian offshore workers began a strike on Tuesday that will reduce oil and gas production, the union leading the industrial action told Reuters.

The strike, in which workers are demanding higher wages to compensate for rising inflation, comes amid high oil and gas prices, which have hit hard with natural gas supplies to Europe, particularly after Russia cut exports.

“The strike has started,” Audun Ingvartsen, leader of the Lederne trade union, said in an interview.

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Operator Equinor (EQNR.OL)the company said on Tuesday that it had begun shutting down three fields in the North Sea as a result of the strike. read more

Norway’s Ministry of Labor reiterated that it was following the conflict “closely”. If there are exceptional circumstances, he can intervene to stop the strike.

Oil and gas production will fall by 89,000 barrels of oil equivalent per day (boepd) on Tuesday, of which gas production will fall by 27,500 barrels per day, Equinor reiterated on Tuesday.

Wednesday’s strike will deepen the country’s gas output cut to just 292,000 barrels of oil equivalent per day, or 13% of output, NOG said on Sunday, in line with Equinor estimates. read more

Equinor said oil production would fall by 130,000 barrels per day from Wednesday, in line with previous estimates from the lobby.

This corresponds to about 6.5% of Norway’s production, Reuters estimates.

The next escalation, planned by Saturday, could shut down about a quarter of Norway’s gas production as well as about 15% of its oil output, according to Reuters estimates.

“The consequences of this escalation are not yet clear,” Equinor said.

Ultimately, it is the decision of the operator – Equinor – to close the outlet.

THREE-STEP ESCALATION

Industrial activities began at midnight local time (2200 GMT) in three fields – Gudrun, Oseberg South and Oseberg East – and will expand to three other fields – Kristin, Heidrun and Aasta Hansteen – from midnight on Wednesday.

A seventh field, Tyrihans, will also have to close on Wednesday as its output is processed from Christine.

On July 9, Sleipner will cease production of Gullfaks A and Gullfaks C, as the Lederne members are considered critical to operations and with potential ripple effects on other fields that transport their products through these fields.

If they did, it could cut crude and other oil liquids production by another 160,000 barrels, and natural gas output by about 230,000 barrels, according to Reuters estimates.

On Thursday, members of the Lederne union rejected a proposed wage deal negotiated by companies and union leaders. read more

Norway’s other oil and gas unions have accepted the wage deal and will not strike.

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Additional reporting by Victoria Klesty Editing by Kim Coghill and Jason Neely

Our standards: Thomson Reuters Trust Principles.

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