Norwegian oil rig workers get tough on pay

Norwegian oil rig workers have started to get tough on pay, demanding extra wages and pension security and threatening strike action.

Oil rig workers in Norway have been criticised in the past for demanding too much pay, with most workers earning more than the average American CEO. Their tough demands mean that European oil has become less competitive, but that doesn’t seem to put workers off from asking for more from their employers.

One reason for this is that the workers are in a very powerful position. Norway is driving a European oil boom, and the country has become the fastest growing in the continent as a consequence. Because of this, workers in the area can almost set their own terms, and they seem to be fully aware of this.

Last month, offshore workers shut off with a 16 day strike for better pay and the right to early retirement. Now, a further shutdown has been threatened in September if the terms of the agreement are not improved. This has been a massive blow to an industry that is already struggling to keep a grasp of spiralling output costs, as well as falling volumes and shrinking margins.

Hege Kverneland, the chief technology officer at National Oilwell Varco, said: "As a Norwegian, it's almost embarrassing that it's twice as expensive to drill in the Norwegian side of the North Sea than on the UK side.

"It's hard to understand and when you see this from the outside, you start to wonder if they are completely mad."

Balazs Koranyi from Reuters believes that Norway has become a victim of its own success. The economy is booming, but with it, has come higher demands from across all the sectors. But the oil industry has seen its peak, and with the demands continuing to grow, this attitude could sink Norway into trouble at the very point when it is enjoying success.

Posted by Claire Manning