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Opinion
Sony Kapoor

No, Norway Isn't Turning Away from Fossil Fuels

Its wealth fund's decision to divest oil and gas assets was more about diversification than environmentalism.
Shifting resources.

Shifting resources.

Photographer: Kyrre Lien

There was widespread excitement last week on the news that Norway’s $1 trillion sovereign wealth fund has announced an intention to sell off its oil and gas holdings. This amounts to about 6 percent of the fund’s stockholdings, about $37 billion. Environmental activists, in particular, are delighted and expect this to trigger a broader sell-off in fossil fuels. They should hold the champagne.

Bill McKibben, the founder of 350.org, called it “astonishing” and compared this to the Rockefellers divesting from fossil fuels. Paul Fisher, now at the Cambridge Institute for Sustainability Leadership, stated that the Fund is “no longer prepared to take the increasing risk associated with oil and gas assets, which do not have a long-term future.” Stephanie Pfeifer, head of the Institutional Investors Group of Climate Change said investors will look more closely at alignment with the low carbon transition.