Asian spot liquefied natural gas (LNG) prices inched up this week as the prospect of possible industrial action at Australian LNG facilities sparked fears it would fuel competition between Asian and European buyers for cargoes.

The average LNG price for September delivery into north-east Asia LNG-AS rose to $11.50 per million British thermal units (mmBtu) from $10.90 the previous week, industry sources estimated. Forward prices for the next two months rose between 10%-15%.

Chevron CVX.N and Woodside Energy Group WDS.AX said on Thursday they are holding talks with unions to avert strikes at Australian LNG facilities that together account for around 10% of global production.

Alex Froley, LNG analyst at data intelligence firm ICIS, said that while there would not be an immediate threat to security of supply from strikes if they go ahead due to healthy storage in Europe and Asia, it could limit further stock building or run down current stocks, adding bullish pressure into the winter months when demand is higher.

However, many market players think that the issue will be resolved and if strikes go ahead they wouldn’t drag into winter.

“Markets in Asia have been absorbing the news of potential supply bottlenecks. Prices didn’t fluctuate much for spot, but there were significant premiums for the forward curve,” said Toby Copson, global head of trading at Trident LNG.

“This shows that the market feels the Australian strike issue will likely be resolved without supply loss and has priced in sufficient supply to cover the near term, amid still relatively weak demand,” Copson added.

Samuel Good, head of LNG pricing at commodity pricing agency Argus, said that Woodside’s Northwest Shelf LNG export terminal is also set to undergo maintenance from Aug. 25 to Sept. 23, cutting the equivalent of one liquefaction train’s capacity at the five-train facility.

In Europe, Good said that the gas market heading into October was already set to be finely balanced, due to very healthy storage levels.

“Any potential alteration to the global LNG supply outlook for the fourth quarter, suggesting that Asian buyers may need to compete more for Atlantic cargoes, could threaten to rock this balance,” he added.

S&P Global Commodity Insights assessed its daily north-west Europe LNG Marker (NWM) price benchmark for cargoes delivered in September on an ex-ship (DES) basis at $11.395/mmBtu on Aug. 10, a $0.45/mmBtu discount to the September gas price at the Dutch TTF gas hub.

Argus assessed the north-west Europe DES price at $11.55/mmBtu, while Spark Commodities estimated the price at $11.89/mmBtu.

A rally in spot LNG freight rates accelerated this week, with Atlantic spot rates rising to $90,250/day on Friday, and Pacific rates rising to $85,750/day, said Edward Armitage, an analyst at Spark Commodities.

Source: Reuters reported by Marwa Rashad and edited by Nina Chestney