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Oil Workers To Shut Output

Oil workers may shut output

A Norwegian oil strike escalated on Thursday to threaten to shut almost all oil and gas output, raising chances of government intervention to end the week-long dispute in the world?s number three oil exporter.

Employers said they would lock out all workers from offshore platforms from Monday night, hoping that would encourage unions to back down after a strike already cutting 375,000 barrels per day (bpd) of Norway?s 3.0 million bpd output.

?We see no other option for ending the dispute than to impose a lockout,? said Per Terje Vold, director general of the employers? Norwegian Oil Industry Association on the seventh day of a strike over pensions and job security.

But unions refused to buckle and blasted the lockout threat as a high stakes gamble that the government would step in to end the strike. It said workers might shut output straight away.

?The threat of a lockout is an encouragement to our members to start a shutdown immediately,? OFS union leader Terje Nustad said in a statement.

Employers said any wildcat shutdowns would be illegal.

Prime Minister Kjell Magne Bondevik declined to say what Oslo would do about the escalating dispute.

A halt to oil and gas output would cut 900 million crowns ($130.3 million) a day in export earnings and dent Norway?s reputation as a supplier, especially of gas to nations from Britain to Italy which cannot switch suppliers at short notice.

?The government sees that the situation is serious and will become more serious because of the lockout,? he told reporters. ?We are continuously evaluating the situation.?

Norwegian governments have a history of stepping in to end oil and gas strikes, ordering mandatory arbitration by arguing that economic interests are under threat.