Figures presented for the fourth quarter by Statistics Norway suggest that the impact of the sharp fall in the price of oil has not yet been fully felt in the country’s national accounts, as the quarterly GDP growth rate of 0.5% fell in line with expectations, taking full year GDP growth to 2.2%.
Interestingly, Statistics Norway is yet to report a significant hit to the national accounts from the collapse in the oil price.
“Value added in petroleum activities and ocean transport grew 2.5% t in the 4th quarter, which contributed to a growth in total GDP in the 4th quarter of 0.9%,” it said.
Crucially, while gross fixed capital formation fell by 2.7% in the quarter relative to the same period a year ago, this was not seen as caused by a collapse in capital expenditure in the oil and gas sector – although there was a noted decline for the period.
“In the 4th quarter, petroleum GFCF was 1.3% lower than the previous quarter. Investments peaked in the 3rd quarter of 2013, and then decreased gradually. In 2014, total petroleum GFCF was at the same level as in 2013,” Statistics Norway commented.
However, it added: “In the 4th quarter, government investment fell 3.7% and contributed to the decline in Mainland GFCF.”
The picture going forward is less clear. There are figures suggesting unemployment may rise from some 3.5% currently to 4% by 2016; this may seem a relatively benign figure compared to much of Europe, but the unknown factor is what proportion of the unemployed will be from the oil and gas sector, where offshore drilling jobs are amongst the highest paid in the country.