spwm norwayNorway, which has long enjoyed the fruits of its offshore drilling, floated a plan to get rid of Norway’s $40 billion in oil and gas stocks from its $1-trillion sovereign wealth fund.

That was easier said than done. A government-appointed commission came out against the divestiture of petroleum stocks. The commission maintained selling the stocks wouldn’t protect the country against declines in crude-oil prices.

“This investment strategy is simple, well founded and has served the fund well,” the three-person group of Oystein Thogersen, Harald Magnus Andreassen and Olaug Svarva, said in their findings. “If energy stocks are excluded from the fund, the composition of the investments will differ from market weights, and the fund will be expected to either achieve lower return or higher risk.”

The next move is an assessment by the government which will now make its own assessment before parliament enters the fray.

Norway is the world’s biggest wealth fund. The opposition in the Norwegian parliament doesn’t seem averse to dropping the oil and gas funds from the benchmark equity index. The minority Conservativeled government hasn’t made it clear where it stands.

Kari Elisabeth Kaski, a member of the Socialist Left, said she felt the report “has a very, very narrow and short-term view on climate risk and the global development in financial markets in terms of handling climate risk. That gives the report limited value.”