Norwegian oil workers threaten to strike as crude continues to rise

 
Jessica Morris
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Oil workers in Norway want a new wage deal (Source: Getty)

Hundreds of oil and gas workers in Norway are threatening to go on strike, halting output at five oil fields in Western Europe's largest producer.

Sites operated by ExxonMobil, Engie and BASF's oil and gas unit Wintershall will be temporarily shuttered if talks between employers and unions on a new wage deal fail.

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Three Statoil-operated sites could also be affected, but the Norwegian Oil and Gas Association said that these would not have to shut in the initial phase of a conflict.

Unions want members to receive pay increases matching those of other industries. However, employers argue that the oil price rout requires cost cuts and flexible work practices to help the industry survive.

It comes as a string of so-called "black swan" events — including outages in producers such as Canada, Nigeria, Venezuela — have squeezed supply and supported crude prices recently.

This has been compounded by Saudi Arabia's dwindling spare capacity, a consequence of its war on the US shale industry, making oil markets more susceptible to price shocks.

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Oil prices spiked today after government data showed weekly US crude stockpiles fell by more than expected. US oil stocks fell by 55,000 barrels per day, compared to 39,000 bdp a week earlier.

Brent crude, the global benchmark, jumped 2.18 per cent to $49.64 per barrel this afternoon. Its US counterpart, West Texas Intermediate crude, swelled 2.42 per cent to $49.01.

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