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.

U.S. energy giant Chevron and unions representing workers at the Gorgon and Wheatstone projects in Western Australia are in daily talks this week to try to come to an agreement over pay and job security. The Fair Work Commission, Australia’s independent workplace relations tribunal, is mediating talks between both sides.

If a deal cannot be agreed, the strikes are scheduled to begin from 6 a.m. local time Thursday. The long-running dispute escalated even further on Tuesday as a union alliance announced plans to strike for two weeks from Sept. 14.

“In response to Chevron’s [duplicitous] claim that our EBA negotiations are ‘intractable’, the Offshore Alliance is escalating Protected Industrial Action to [demonstrate] that our bargaining negotiations are far from ‘intractable,'” the Offshore Alliance said in a Facebook post.

“Offshore Alliance members are yet to exercise their lawful workplace rights to take Protected Industrial Action and our bargaining claims will look more and more reasonable as Chevron’s Gorgon and Wheatstone LNG exports dry up.”

In response, a Chevron Australia spokesperson told CNBC, “We’re looking to narrow points of difference with Gorgon and Wheatstone downstream employees and their representatives through further bargaining mediated by the Fair Work Commission.”

Fears of strike in Australia, one of the world’s biggest exporters of liquified natural gas (LNG), have recently pushed up European gas prices — and analysts expect near-term volatility to persist.

Jacob Mandel, senior research associate for global energy markets at U.K.-based consultancy Aurora Energy Research, said the global natural gas market was currently “very tight” and “very little supply flexibility” means that strike action in Australia could send European gas prices higher.

“Prices have moved quite significantly on basically little bits of news on what’s happened to these two facilities because there is so little flexibility in the market that the slightest provocation will cause large changes to the prices,” Mandel told CNBC via videoconference.

He said that European gas prices could climb to above 40 euros ($42.9) per megawatt hour if the strikes go ahead as planned. The front-month gas price at the Dutch Title Transfer Facility (TTF) hub, a European benchmark for natural gas trading, traded at 33.5 euros on Tuesday.

The TTF contract rose sharply to around 43 euros last month. TTF prices have since pared gains, however, and remain well below last summer’s extraordinary spike to more than 300 euros.

“I think it is extremely unlikely prices will go anywhere near where they were last September, where they hit these massive record peaks,” Mandel said. “Prices reached those peaks under extraordinary circumstances, which in theory could have been replicated. However, in Europe, we’ve taken many steps that could keep prices from reaching such a high.”

“It doesn’t mean that prices could increase above this 40 per megawatt hour level and if something else happens — a sudden winter storm, or something like this — certainly this can push [prices] higher,” he added.

Kaushal Ramesh, head of gas and LNG analytics at research firm Rystad Energy, said looming industrial action at Chevron’s Gorgon and Wheatstone facilities suggested near-term volatility could continue until a resolution is reached.

“We still don’t think there will be a material impact on production,” Ramesh said, citing the resolution of other similar disputes. He noted that it may become difficult for Chevron to prolong the strikes if they do go ahead.

“Whatever monetary impact there may be to Chevron from giving in to the workers’ demands is likely a fraction of lost revenue if production were to be substantially impacted,” Ramesh told CNBC via email.

“Thus, these are political developments, and things can get irrational, but so far, Asian buyers have not been too concerned. This winter, Japan and Korea will have an additional 6 GW of nuclear power available compared to the previous year.”