The Oslo government has authorised the Sovereign Wealth Fund of Norway – the largest in the world – to initiate divestment in the oil sector. In detail, the Fund has obtained the go-ahead a sell its shares in 95 oil companies, holdings that are worth overall 5,4 billion euros. A high figure in absolute terms, but certainly not decisive for the Norwegian Sovereign Fund, which manages total assets of over one trillion dollars.
However, the start of oil disposals marks the entry into a new phase. Moreover, the decision was well thought out, given that the authorization arrives two years after the Fund's request to be able to exit the oil sector altogether, with the aim of reducing the hydrocarbon exposure of Norway, the largest producer of oil and gas in Western Europe.
Ultimately, the government opted for significantly more limited divestment, limiting the operation to companies engaged exclusively in the exploration and production of hydrocarbons. Groups with diversified activities such as ExxonMobil, Total or BP do not fall within this perimeter.
The divestment was announced by the Norwegian Finance Ministry on Tuesday evening, but did not provide a list of the companies involved.
The disengagement will be gradual and should take quite a long time, depending on market conditions.
Although dictated by purely financial considerations, the prospect of Norwegian withdrawal from the oil sector has been welcomed by many environmental organisations.
