Natural gas markets are in turmoil as strikes hit two Australian Liquefied Natural Gas (LNG) export facilities.

Chevron Corp. (NYSE:CVX)’s inability to secure agreements with unions has unleashed a series of disruptions across key facilities, including the Gorgon and Wheatstone plants and the Wheatstone offshore platform in Western Australia.

These strikes come after weeks of tense negotiations that had kept markets on edge since early August. While Woodside Energy Group Ltd. (NYSE:WDS) managed to reach a compromise with its workers, Chevron remains at odds with its workforce over several critical claims.

7% Of Global LNG Supply At Stake

The impact of these strikes is significant, as these facilities account for over 7% of the global LNG supply, primarily serving Asia. Prolonged strikes could disrupt operations and lead to a decrease in LNG supply, potentially affecting prices worldwide.

According to a statement by the Offshore Alliance, the Chevron workers’ trade union, negotiation efforts have been notably deficient, described as the least effective in the past half-decade, leaving their members deeply dissatisfied. In response, workers intend to undertake approximately 20 different actions, including stoppages and the imposition of task-related bans.

Natural Gas Prices Spike

Investors have already witnessed a reaction in natural gas prices, with the European Dutch TTF benchmark surging over 10%. In the United States, the Henry Hub natural gas price rose 2% to $2.64/MMBtu.

Latest data by the EIA reveals that natural gas reserves in the United States experienced an increase of 33 billion cubic feet (Bcf) last week, falling short of the anticipated 43 Bcf build. This rise also stands notably lower than the averages recorded at the end of the second quarter.

Chart: U.S. Natural Gas Have Fallen 30% Year To Date

Stocks Affected

Shares of major U.S. natural gas exporting companies were reacting, with Cheniere Energy Inc. (NYSE:LNG) gaining 1.41% during Friday morning’s trading session.

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