Norway's $900billion oil and gas 'insurance policy' should move its investments into equities and away from bonds to avoid low-interest rates, the government claim.
With oil prices still wobbling around $50, Norway is in danger of a recession that could drive its benchmark interest rates, already at a record low, to zero. That’s what economists at Svenska Handelsbanken AB in Oslo say as they warn that “recessionary risks are significant.” The central bank in September cut rates to 0.75 percent and signaled more than a 50 percent chance for a third reduction since the drop in oil prices accelerated, about a year ago. Handelsbanken sees three cuts next year, bringing the benchmark to zero by the end of 2016. “The Norwegian economy will now experience a deeper downturn than during the financial crisis, with output expected to stay below its potential for longer than it did last time,” Kari Due-Andresen and Knut Anton Mork, economists at Handelsbanken, wrote in their latest report.
Two energy service firms will share the spoils of a £5million investment by the Scottish Loan Fund (SLF), it was announced yesterday. North Sea well integrity specialists Meta Downhole and Read Cased Hole (RCH) will use the cash to support their international growth ambitions, SLF said. Meta and RCH, both based in Bridge of Don, Aberdeen, are trading companies of Read Well Services Holdings.
Nigeria’s President Muhammadu Buhari said he will hold the country’s oil portfolio in his new cabinet, rather than trust anyone else with the source of most of its revenue. Buhari, who took office earlier this year, has promised to combat corruption and made clear he wants to overhaul the oil sector in Africa’s biggest economy. At an annual meeting of world leaders at the United Nations General Assembly in New York this week Buhari said he intended to remain as the minister of petroleum resources.
Nigeria’s sovereign wealth fund doesn’t expect any major payments from the government as the finances of Africa’s largest oil producer have been hit by a halving in crude prices in the past year. “The weakness in crude oil prices might persist for the foreseeable future, thereby potentially impacting on new contributions from the federation,” Nigerian Sovereign Investment Authority Chairman Mahey Rasheed said in its 2014 annual report released on Thursday.
Energy Secretary Ed Davey insisted the UK has a “moral duty” to help the world’s poor cope with rising temperatures as the Government unveiled a £720 million pledge to a UN climate aid fund. He dismissed “little Englander” critics of the UK contribution to the UN Green Climate Fund, which will help poor countries adapt to the impacts of climate change such as floods and droughts and help them develop their economies while curbing emissions. Some Tories have voiced doubts about the spending, which comes from existing UK aid commitments, pointing out that the deficit is still running at £100 billion a year and Britain’s own flood defences need shoring up.