An escalating dispute at major gas facilities in Australia could drive up European prices, analysts say

Key Points

• Fears of strike in Australia, the world's biggest exporter of liquified natural gas (LNG), have recently pushed up European gas prices and analysts expect near-term volatility to persist.
• "There is so little flexibility in the market that the slightest provocation will cause large changes to the prices," said Jacob Mandel, senior research associate for global energy markets at Aurora Energy Research.
• Wild price swings in energy markets in recent weeks come as the euro zone continues to wean itself off Russian fossil fuel exports following the Kremlin's full-scale invasion of Ukraine.

Liquefied natural gas (LNG) storage units at Grain LNG importation terminal, operated by National Grid Plc, on the Isle of Grain on August 22, 2022 in Rochester, England.

Dan Kitwood | Getty Images News | Getty Images

The looming threat of strikes at Australian natural gas facilities will keep global gas markets on tenterhooks, energy analysts told CNBC, with traders fearing that a prolonged halt to production could squeeze global supplies and send European prices higher.