Workers at Chevron Corporation's (NYSE:CVX) liquefied natural gas (LNG) projects in Australia went on strike on Friday after mediation talks ended without any deal.

Until next Wednesday, workers will stop work for up to 11 hours in several blocks daily and refuse to perform certain tasks. 

The commencement of industrial action signifies the conclusion of protracted discussions that have left markets uncertain for weeks. 

In early August, labor unions initially hinted at the possibility of strikes affecting both the Chevron installations and those of Woodside Energy Group Ltd (NYSE:WDS). 

Subsequently, Woodside reached a negotiated settlement with its workforce, while Chevron and its employees still find themselves at odds regarding several critical demands.

A prolonged strike could disrupt exports and raise prices of LNG, which is used for electricity generation. European gas prices have been volatile in recent weeks over the labor unrest in Australia.

European benchmark gas futures surged by as much as 11% in response to the news, although they later receded somewhat. This reaction underscores the market's susceptibility, especially after last year's energy crisis.

Dutch front-month gas, Europe's benchmark, traded 5.8% higher at €34.64 a megawatt-hour by 10 a.m. in Amsterdam.

While Europe rarely receives fuel shipments from Australia, reducing LNG deliveries to Asia would intensify competition for other available cargoes.

Price Action: CVX shares are up 0.35% at $167.22 during the premarket session on the last check Friday.