Norway plans to withdraw $37 billion from sovereign wealth fund

According to Bloomberg, Western Europe's largest oil exporter, Norway, is preparing to withdraw a record 382 billion Norwegian kroner ($37 billion) from the sovereign wealth fund. In the face of the crisis caused by the new coronavirus and the collapse of the oil market, the world's largest sovereign investor is expected to sell assets to generate cash. Current

ly, the country faces the worst economic crisis and for the first time, the government should withdraw considerably more than the $1 trillion fund generates in cash flow from dividends and interest payments. In addition, the fund needs to increase its position in shares after the variable income portfolio has fallen below the required target of 70% of

the total. Recalling that by 2016, the structural deficit corrected by oil resources was covered by the state's income from the commodity – taxes, stakes in offshore fields and dividends from Equinor. Due to falling prices in recent years, many withdrawals have been made but the fund still managed to cover the value easily with cash flow. But by 2020, everything has changed and the government expects net cash flow from oil activities to shrink 62 percent to 98 billion kroner, the lowest level since 1999.

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