The man running the world’s biggest wealth fund said snapping up oil stocks now could pay off down the line. It’s just not a good idea for Norway.
The $1 trillion fund, built from Norway’s own production of petroleum, shockedmarkets in November when it announced a proposal to dump oil and gas stocks. The rationale was that given Norway’s overall exposure to oil it didn’t make sense to also tie up financial assets in the petroleum sector, rather than a view on the future viability of the industry.
On Tuesday, Yngve Slyngstad, the fund’s chief executive officer, went a little further, acknowledging that the future of the business is very much up in the air, saying it’s “obvious” that there’s an energy transition happening.
“This energy transition will affect the consumption of oil and gas, and therefore, of course, could affect the profitability of oil and gas companies,” he said in an interview.