Norway’s £1tn wealth fund likely to divest all oil and gas

Norway’s $1tn sovereign wealth fund should be be divested of all interests in oil and gas companies, says the country’s central bank, “in a move that could have significant consequences for the sector”, says The Guardian.

Norges Bank, which manages the fund, said divestment would make the country less vulnerable to declining crude prices. Oil and gas companies currently make up around 6% of the fund’s benchmark equity index.

While the central bank said the view was not based on any prediction of future oil and gas commodity prices or the “sustainability” of the sector, “the move will be closely watched given the fund’s clout in global equity markets”, says the Financial Times.

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The recommendation, which is being considered by the government, would mark a symbolic shift from fossil fuel investments and would be particularly pertinent given the fund has grown off the back of Norway’s north sea oil operation.

Green campaigners welcomed the news. “This is a victory for common sense. We have argued this for some time and there is no reason for Parliament not to approve this,” Martin Norman, of Greenpeace Nordic told Reuters.

Rachel Kennerley of Friends of the Earth said: “Bravo Norway, and let’s hope it gets through because the future of fossil fuel investment is looking shaky indeed.”

This is the second major victory for environmentalists in less than a day, after an alliance of 19 countries, meeting at the UN climate summit in Bonn, committed to quickly phasing out coal.

Mexico, New Zealand, Denmark and Angola signed up to the Powering Past Coal Alliance, led by the UK and Canada. The moment was hailed as a “political watershed” by campaigners. It is hoped more countries will sign up to phase out coal, which currently provides 40% of global electricity.