The war increases oil and gas profits in Norway. Now, he is urged to help

Stavanger, Norway (AFP) – Europe’s frantic search for alternatives to Russian energy It has dramatically increased demand – and price – for oil and gas in Norway.

With money pouring in, Europe’s second-largest supplier of natural gas is avoiding accusations that it is profiting from the war in Ukraine.

Polish Prime Minister Mateusz Morawiecki, who is looking to the Scandinavian country to replace some of the gas Poland uses to get it from Russia, said Norway’s “massive” oil and gas earnings are “indirectly exploiting the war”. He urged Norway to use this windfall to support the hardest-hit countries, particularly Ukraine.

The comments last week struck a chord, even as some Norwegians questioned whether they were doing enough to combat the Russian war by increasing economic aid to Ukraine and helping neighboring countries end their dependence on Russian energy. for the energy industryElectricity and fuel generation for vehicles.

Taxes on windfall oil and gas companies were common in Europe to help people deal with high energy bills, now exacerbated by the war. Both Spain and Italy have agreed to it, while the UK government plans to introduce one. Moraveki is asking Norway to go further by sending oil and profits to other countries.

Norway, one of Europe’s richest countries, has committed to allocating 1.09% of its national income to foreign development – one of the highest percentages worldwide – including more than $200 million in aid to Ukraine. With oil and gas tanks Oversized, some would like to see more money earmarked for mitigating the effects of the war — not cutting it out of funding for agencies that support people elsewhere.

“Norway has made deep cuts to most UN institutions and supported human rights projects in order to fund the cost of taking in Ukrainian refugees,” said Berit Lindemann, policy director for the Human Rights Group at the Norwegian Helsinki Committee.

She helped organize a protest on Wednesday outside parliament in Oslo, criticizing the government’s priorities and saying the Polish statements “have some merit”.

“It just looks really ugly when we know that incomes have gone up really bad this year,” Lindemann said.

Oil and gas prices It was already high amid the energy crisis It rose because of the war. Natural gas is trading three to four times more than it was at the same time last year. The price of international benchmark Brent crude rose to $100 a barrel after the invasion three months ago and has rarely fallen below that since.

Norway’s energy giant Equinor, which is majority owned by the state, posted four times more profit in the first quarter than in the same period last year.

The bounty prompted the government to revise its forecast for income from petroleum activities to NOK 933 billion ($97 billion) this year – more than three times what it earned in 2021. The bulk will be directed to Norway’s massive sovereign wealth fund – the world’s largest – to support the nation. When the oil dries. The government is not thinking of transferring it to another place.

Norway has “contributed significant support to Ukraine since the first week of the war, and we are preparing to do more,” Norwegian Foreign Minister Evind Vad Petersen said via email.

He said the country had sent financial support, weapons and more than two billion kroner in humanitarian aid “regardless of oil and gas prices”.

Meanwhile, European countries have helped inflate Norway’s energy prices by seeking to diversify its supply away from Russia.. They were accused of helping finance the war by continuing to pay for Russian fossil fuels.

This energy dependence “provides Russia with a tool to intimidate us and use it against us, and this has now been clearly demonstrated.”NATO Secretary General Jens Stoltenberg, former Prime Minister of Norway, said during the World Economic Forum meeting in Davos, Switzerland.

Russia has stopped natural gas from FinlandPoland and Bulgaria for their refusal to request payment in rubles.

The 27-nation European Union aims to reduce dependence on Russian natural gas by two-thirds by the end of the year Through conservation, renewable development and alternative supplies.

Europe is pleading with Norway, along with countries like Qatar and AlgeriaTo help with the shortage. Norway provides 20% to 25% of natural gas in Europe, compared to 40% for Russia before the war.

Deputy Energy Minister Amund Fick said it was important for Norway “to be a stable and long-term provider of oil and gas to European markets”. But companies sell in volatile energy marketsAnd “with the rise in oil and gas prices Since last fall, companies have been producing nearly the maximum daily of what their fields can offer.

However, Oslo has responded to European calls for more gas by granting permits to operators to produce more this year. Tax incentives mean that companies invest in new overseas projectswith a new pipeline to Poland Opening this fall.

“We are doing everything we can to be a reliable supplier of gas and power to Europe in challenging times. It was a tight market last fall and it is even more urgent now,” said Ola Morten Aanestad, a spokesperson for Equinor.

The situation is a far cry from June 2020, when prices collapsed in the wake of the COVID-19 pandemic and the previous government of Norway issued tax incentives to oil companies to stimulate investment and protect jobs.

Combined with rising energy prices, incentives that ran out at the end of the year prompted companies in Norway to issue a slew of development plans. for new oil and gas projects.

However, these projects will not produce oil and gas until later this decade or even more in the future, when the political situation may be different and many European countries hope to shift most of their energy uses to renewables..

By then, Norway will likely face the most common criticism – that it contributes to climate change.

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Monika Sislowska, an Associated Press reporter in Warsaw, Poland contributed.

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