Norway steps in to relieve energy crisis in EU

Norway has intervened to end a strike by oil and gas workers from Russia amidst the ongoing war in Ukraine.

The statement came from the country's government on July 5, according to CNN Business.

Natural gas prices spiked after Norwegian oil and gas workers went on strike over a pay dispute on July 5, shutting three fields in the North Sea and threatening to escalate action over the week.

Norway is Europe's second-largest energy supplier after Russia and the strike had pushed gas prices to their highest level in four months.

The Norwegian government has proposed a compulsory wage arbitration to settle the dispute, the statement said.

"We normally exercise significant restraint before intervening with compulsory wage arbitration," Labor Minister Marte Mjøs Persen said after he summoned oil companies and workers to a meeting late Tuesday. "However, the serious consequences of the announced escalations have forced my hand in intervening."

The Norwegian oil and gas employers' lobby had said the strikes could have halted almost 60% of Norwegian gas exports to Europe from July 9.

The closure of the three fields resulted in the loss of the equivalent of about 89,000 barrels of oil a day, Norway's state-owned energy company Equinor said in a statement.

Europe is trying to reduce its reliance on Russia's exports, which are already being curtailed by Moscow. Any sustained drop in Norway's output could deal a big blow to efforts to replenish gas stocks ahead of the winter, as well as raise the risk of a catastrophic energy shortage.

Germany, the region's biggest economy, has already declared a "gas crisis" and warned it can't rule out introducing rationing to get through the winter.

News of the strike helped push European natural gas futures prices up 5% to hit 172 euros ($177) per megawatt-hour, data from the Intercontinental Exchange showed. That's the highest price since early March in the days following Russia's invasion of Ukraine.

"The Ministry of Foreign Affairs emphasizes that Russia's offensive war against Ukraine has had a major impact on the security of supply in many European countries," the Norwegian government said in its statement.

"There is an immediate risk of additional energy shortages in Europe. A reduction in Norwegian gas deliveries will worsen the energy crisis, in addition to the inherent political, financial and societal consequences. Norway must do everything in its power to bolster European energy security and European solidarity against Russian aggression."