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Oil products output at Europe’s largest oil refinery—Shell’s 404,000-bpd Pernis refinery in the Netherlands—will be reduced after workers started a strike on Monday, demanding higher wages.
“There will be impact on production but at this point we can’t say exactly what the exact impact will be because we don’t know yet,” a spokeswoman for Shell told Reuters today, confirming that the industrial action, which local trade unions threatened in March, had begun.
In March, Dutch trade union CNV gave Shell seven days to meet their demands before announcing a strike.
At the end of last month, CNV said that workers would reduce production at the Pernis refinery and the Moerdijk chemical plant beginning on April 8 and would keep output at lower levels until workers’ demand are met.
The union had given no indications of the amount of output reduction, but Pernis is the largest oil refinery in Europe, and the point is to reduce output to a level that would force Shell to meet demands for higher wages.
Unions want a 5-percent wages increase, while Shell offers a 2-percent raise this year and another 2.5-percent salary increase next year, according to Reuters.
“We are taking it day by day, we will have another technical meeting with the unions this afternoon, and we will take it from there,” Shell’s spokeswoman told Reuters today.
According to the FNV trade union, production at the Pernis refinery will be gradually cut to 65 percent of the facility’s capacity today, as part of the strike for higher wages.
The reduction will be kept in place until Wednesday night, after which the trade union will discuss where negotiations are going and what to do next, FNV trade union’s spokesman Egbert Schellenberg told Reuters on Monday.
Shell has just launched a new unit at Pernis in October last year to enhance performance and reduce environmental impact by enabling the processing of more oil into cleaner transportation fuels.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.