A union push to boost job security and better pay for workers in the immensely profitable offshore gas industry has caused a stir in jittery global energy markets.

After workers for fossil fuel giants Woodside and Chevron in Western Australia this week voted to strike for better conditions, European oil futures spiked as high as 40 per cent over fears Australia’s increasingly vital gas exports could be disrupted.

Crucially, the vote to strike doesn’t mean one will go ahead – negotiations resume next Tuesday.

Executives from the gas companies are scrambling to cut a deal with the Offshore Alliance, a partnership by the Maritime Union of Australia (MUA) and the Australian Workers Unions (AWU), to avoid work stoppages.

The position of the unions is clear; AWU WA secretary Brad Gandy said workers want an enterprise agreement with industry-standard conditions.

“Gas producers like Woodside and Chevron might be used to throwing their weight around in countries with weak industrial laws, but Australian workers have fought for over 100 years for strong industrial rights,” Mr Gandy said.

“The sooner these huge, profitable gas producers approach these negotiations pragmatically and get back around the bargaining table the better.”

The industrial dispute comes at a movement of peak influence for Australia’s LNG export business and, by extension, the workers who operate the industry’s offshore mining rigs.

The facilities in question now together supply about a tenth of the global liquified natural gas (LNG) market, which has been severely affected by Europe weaning itself off Russian fuels.

The situation has run rivers of gold for the gas industry, which has reported tens of billions of dollars in profits over the past year on the back of sky-high gas export prices.

Jittery markets

RMIT University Associate Professor Angel Zhong said global markets are jittery about any disruption to Australian supplies because it could spark a chain reaction where a shortage of LNG in Asia squeezes European markets.

“If there is reduced supply to Asia due to strikes affecting Australian LNG production, Asian buyers might turn to other sources, including European suppliers, to meet their demand,” Dr Zhong said.

“This increased demand from Asia could lead to decreased availability of LNG in the European market, driving up prices.”

The prospect of industrial action at the offshore gas terminals is unlikely to have any meaningful impact on gas prices for Australians, though, because the LNG is earmarked for export.

But with Australia now a more dominant player in the LNG market, even the threat of industrial action can have a wide ranging impact, Dr Zhong said.

“It also reflects the structural changes in this sector after the Russia-Ukraine war, which resulted in [an] ongoing energy security issue around the world,” she said.

Workers ‘acutely aware’ of gas profits

Mr Gandy said workers were “acutely aware” of how much profits the gas industry is making.

He said that a strike at Shell facilities last year that lasted 76 days cost the gas giant about $1.5 billion in lost production.

“Woodside and Chevron must not continue to reject reasonable claims including Tier 1 pay and conditions and prohibitions against outsourcing jobs to labour hire contractors,” he said.

“Both Woodside and Chevron are insanely profitable companies. It’s not outrageous for the workers who are responsible for these profits to ask that the companies share.”

Woodside said in a statement this week that it was continuing to negotiate with the unions.

“Positive progress is being made and the parties have reached an in-principle agreement on a number of issues that are key to the workforce,” a spokesperson said.