Ineos said on Sunday that it has agreed to go to independent arbitration with the Unite union over a dispute at the UK Grangemouth refinery and petrochemical plant that has led to industrial action including a strike planned to begin next week.

The move significantly decreases the chances of a strike which could have caused severe disruption to the fuel supply in Scotland and the north of England, and the disruption of a key stream of North Sea oil which underpins the Brent benchmark.

"Ineos has today announced it is to begin talks on Monday afternoon with Unite the Union at the offices of the Arbitration and Conciliation Service in Glasgow," Ineos said in a statement.

Unite said on Friday it would go on strike from Oct. 20 for 48 hours in a dispute over alleged unfair treatment of a plant worker. Ineos had up until now refused to go to arbitration.

The union and company are also arguing over terms and conditions at the plant. Ineos has said the petrochemical plant would close by 2017 unless a "survival plan" involving cutting pension entitlement and pay was implemented.

"We hope to be able to resolve the dispute and address the financial issues that threaten the survival of the entire site," said Calum MacLean, a company official.