Enough of energy stocks. One of the largest sovereign wealth funds is now looking to sell off some $35 billion worth of energy stocks. Norway’s $1 trillion sovereign wealth fund is preparing to sell of some $35 billion in oil and gas stocks, Bloomberg reports. The move is intended to diversify its portfolio.
Oslo based $1 trillion fund said in Thursady that droping of oil stocks will improve the financial outlook in the future. With less investing in oil stocks, the fund will be less vulnerable. Fifth of economic output of Norway is from oil and gas.
“Our perspective here is to spread the risks for the state’s wealth. We can do that better by not adding oil-price risk, ” Egil Matsen, the deputy central bank governor overseeing the fund, said in an interview in Oslo.
Dumping of oil stocks will include shares of international giants such as Exxon Mobil Corp. and Royal Dutch Shell Plc. This move will put under pressure oil producers as a growth of renewable energy supplies continue worldwide.
Norway biggest hedge fund doubled in value over the five years. “It’s important that the fund is managed in a way that’s predictable and long-term,” said Nikolai Astrup, leader of the finance committee representing the ruling Conservatives. The move away from oil stocks is praised also from enviromental groups.