According to the newspaper, during the gas crisis, Norway’s star rose… It took the lead and did its best to keep the lights on across Europe, as it increased production to compensate for possible Russian supplies.
However, the price of gas has more than doubled since Russia publicly began reducing its exports in June. Many things have taken a hit as a result of this. Even factories have reduced their noise levels. Some believe it is time to ask Norway to do more; it is something that may have taken a beating. One day, it will be a fantasy, but Norway must agree to lower its gas selling prices.
Before the cries of protest from Oslo and the complaints of market economists erupt, it should be noted that this is not an official proposal, but rather private opinions whispered in private by high-ranking executives in the oil and gas field from outside Norway, and since that is the case, they are It’s worth getting to know her.
According to the Financial Times, Europe is in the midst of an economic war as a result of Russia’s invasion of Ukraine, whether it wants to admit it or not.
He went on, The biggest impediment to European support for Kiev…is turning the energy crisis into an economic crisis and diverting Western voters’ attention away from domestic issues. Gas prices are not only high, but have quickly become an economic weapon.
Norway makes a lot of money selling gas at a price equivalent to $400 per barrel of oil, this number is so huge that it boggles the mind, she adds, but no matter how high the profits are, it is not in Norway’s interest to look at its neighbours as they fall one by one into the quagmire of a deep economic recession, or to see Russia’s boldness to the point of moving towards the borders of the European Union.
She goes on to say, We will supply some of the difficult numbers because they leave an impression on the soul. The majority of Norwegian gas is piped to Europe, where it accounts for roughly one-quarter of the continent’s supplies. While the UK’s share of this gas alone accounts for 40 of Norwegian gas .
In May, the Norwegian government expected that its revenues from oil and gas would reach 100 billion euros this year, and we’re talking about a country with a population of no more than 5.4 million people, which means that the per capita share is around 18,000 euros, which represents more than the total public spending, she adds. Per capita government spending in the United Kingdom in 2020/21.
Since then, gas prices have more than doubled, and it now costs ten times what it did a decade ago. Norway clearly has a lot of financial space. In comparison, last year’s oil and gas revenues were less than 30 billion euros she claims
If Oslo agrees to cap prices at $150-200 per barrel, that is more than the average of what Norway achieved in the first half of this year, when government-backed energy giant Equinor posted record profits. True, these prices are still painful, but the European economies must bear them.
Aslak Berg, an economist, believes that any price reduction would be difficult for Oslo to accept politically, but the displacement has an interest in contributing to European economic stability and support for Ukraine. According to the expert, the option that may make sense for both parties is commitment. With long-term contracts at prices significantly lower than the current price but significantly higher than the historical average.
It is difficult to find a magic solution; on the other hand, it is critical that European gas prices remain high in order to attract the necessary LNG shipments before they go to Asia. Price stability under the influence of market factors is also a risk she claims
According to the newspaper, Norway, in turn, is vulnerable to global economic fluctuations caused by volatile energy prices. This risk is more prevalent than some may believe. Norway’s $1.2 trillion sovereign wealth fund lost 14.4 percent of its value in the first half of this year, amounting to 174 billion dollars dollars, which is more than the government can earn from high oil and gas prices.
Norway also recognises that the crisis poses a threat to the long-term volume of gas demand. As a result, it is eager to construct a future energy economy based on renewable energy sources (offshore wind and hydrogen), as well as close collaboration with its neighbours. According to the Financial Times, high-level executives in Norway have openly expressed their concerns about being perceived as Norway First.
It is critical for Europe to avoid the trap of appropriating its national resources and turning its back on its neighbours, as this will benefit Putin. No one should suggest that Norway be treated as a crisis beneficiary while ignoring its contribution to European energy security. But it’s at least worthwhile. Discuss what steps can be taken to reduce prices.
Maximizing the space and allowing the maximum flow is appreciated. Doing so at a price that helps ease the suffering of European economies may also be in Norway’s interest, the paper concludes.
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