Oil fund passed 12800 billion – E24

Since the creation of the current fund structure in 1998, the value has mostly gone up.

On Monday, the value of the oil fund reached more than NOK 12,800 billion, record highs.

This is evidenced by the informal box counting system websites.

Since the end of the third quarter, the fund’s value, measured in NOK, has risen by about NOK 600 billion, or about five percent. Fund value was From 12.216 billion crowns at the end of the third quarter.

The fund experienced some difficult quarters with negative returns, but recovered as the year ended. At the beginning of 2022, the value of the fund was NOK 12.340 billion.

Several years of new records

The oil fund is not far off with a value of NOK 13,000 billion.

In this case, it will be another milestone in the chain of records in recent years:

Last month, E24 wrote that the fund had reached a new record of NOK 12,600 billion, and since then the value of the Krona has increased further. The value of the fund in krone is particularly affected by three factors:

• Exchanges: Increasing the stake increases the value of the fund’s holdings, which make up the main part of the fund
• Krona exchange rate: The weakness of the kroner against the dollar and the euro increases the value of the fund’s foreign assets in kroner
• Supply: The government receives a lot of oil money at the moment, and saves the rest in the oil fund

Three percent amounting to DKK 384 billion.

If today’s value holds until the new year, the government will have room to spend NOK 384 billion worth of oil money next year. The self-imposed maximum annual use of oil money is three percent of the fund’s value.

However, the government said it was concerned that Norges Bank would raise interest rates more, and keep the use of oil money low to avoid stimulating the economy too much. The use of oil money next year is estimated at 317 billion crowns, according to the state budget.

It is less than the level of oil money that was spent in the years that followed the Corona crisis in 2020, but it is much higher than the money that was spent before the crisis. In 2019, the use of oil money was NOK 231 billion.

In the 2023 state budget, the government assumed that the fund should be worth NOK 12,500 billion at the beginning of 2023.