Norwegian investors keep eye on Qatar uncertainty

Jonathan Boyd
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Norwegian investors keep eye on Qatar uncertainty

With one of the world’s biggest exporters of hydrocarbons subject to an intense diplomatic and trade embargo by surrounding countries, developments involving Qatar are being closely watched by Norway, one of Europe’s biggest producers and exporters of oil and gas, for the impact on Norwegian asset values.

Data from the Oslo Børs suggests that one of the local market’s biggest companies by market capitalisation, Statoil, has seen its share price suffer in recent days.

(Source: Oslo Børs)

Meanwhile, data from Trackinsight points to a relatively mixed year for the broader Norwegian market since the start of 2017.

Thina Saltvedt, chief analyst Macro/Oil at Nordea Markets, has re-tweeted her own comment carried yesterday in Norwegian publication E24 that the decision as it then stood for Saudi Arabia, Bahrain, Egypt and the UAE to cut diplomatic, land, sea and air links to Qatar did not constitute a definitive factor in terms of the global oil price.

“They are trying to isolate Qatar more economically, but from there to starting to impact oil production is quite far,” Saltvedt said, referencing the agreement by Opec members to adjust output, but which continues to be difficult to implement.

Evidence of this came from the Joint Opec-Non-Opec Ministerial Monitoring Committee (JMMC), which effectively concluded at its third meeting on 24 May in Vienna that a nine month extension of the output adjustment regime would be required to ensure that production stays within the agreed limits (http://www.opec.org/opec_web/en/press_room/4295.htm).

Meanwhile, Saltvedt has noted at a recent conference that Norway itself may need to look beyond its reliance on oil and gas, as energy production and use changes, and as uses of oil byproducts change.

Data from FE shows that funds with at least 50% exposure to Norway have provided mixed fortunes for investors over the past six months, when the performances are shown in euro terms.

Among the below listed funds, the Nordea 1 – Norwegian Equity is available for sale in Switzerland, Spain, Italy, Luxembourg, Portugal and Singapore. A number of its biggest holdings are in financials, although there is also exposure to oil such as via Aker BP, the exploration and production business focused on the Norwegian continental shelf.

At the other end of the performance spectrum among this group of funds, the Storebrand Vekst is instead heavily weighted towards telecoms, media and technology, while the Nordea 1 – Norwegian Kroner Reserve is a fixed income fund

 

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