Norway: recovering ‘petroholic’ or prudent saver?
My name is Norway and I’m a petroholic.
“I’ve tried it all: Vaseline, kerosene, gasoline, jet fuel and diesel. I’ve even tried natural gas,” says a leaflet from the most controversial stand at Norway’s biggest oil and gas exhibition.
Situated next to lavish exhibits of dozens of oil and gas companies and hundreds of oil sector contractors, green group Bellona is preaching the sober message of the renewables revolution at the heart of Norway’s oil world – the ONS conference in Stavanger.
In a 12-step rehab plan for Norway, Bellona says the world’s No. 5 exporter of oil and No. 2 gas provider has based its prosperous economy on resource extraction that will not last, and is already exhibiting signs of a “petro hangover”.
By some measures, Norway is increasingly dependent on oil. Half of its exports, a third of budget revenues and a quarter of its economy come from the offshore sector. Studies show that wages in Norway, which was the poorest Scandinavian country at the start of its oil era 40 years ago, are among the highest in the world and about a third higher than in neighbour Sweden.
Norwegians also work the fewest hours per year in the developed world, take the most sick leave, and have built up a generous welfare state that relies heavily on oil revenues.
But Norway has also managed to do something quite sober – it has saved some of its oil wealth in an offshore fund, to spend when the black gold runs out. The democratic world’s biggest public savings experiment has grown to about $450 billion, or the size of Norway’s annual GDP.
By diverting the stream of petro-dollars away from its economy, it has managed to avoid overheating and collapse of non-oil industry associated with the “oil curse” that has engulfed many resource-rich states.
So what’s your view? Is Norway a petroholic in need of rehab, or a prudent saver with a taste for petroleum tipple?
(Photos: Top left – the Statfjord A platform and its loading buoy in the North Sea. Right: The Oseberg oil platform in the North Sea. Both pictures – Scanpix/Reuters)