Selling oil and gas, Norway has made an unprecedented profit from the international blockade on trade with Russia.
Its revenues for the year amounted to US$138 billion as multiple European countries sought to replace Russian fuel.
The war in Ukraine represented a resounding change in the most important boards of international politics, including the rise of energy security as the main issue on the agenda of many countries in the region and worldwide.
With rising energy prices and following Europe’s estrangement with Russia, Norway became Europe’s new leading gas supplier, obtaining 2022 record oil and gas revenues of some kr1.5 trillion (US$138 billion).
According to Statistics Norway’s official report, “total revenues from the oil sector for the general government in 2022 are estimated at kr1.457 trillion (US$138 billion), by far the highest ever recorded in statistics.”
It adds, “Through ordinary tax and excise tax from oil companies, the state is estimated to collect kr884 billion (US$84 billion), which is almost triple compared to 2021.”
Revenues from the state’s direct ownership of oil and gas fields, pipelines, and onshore facilities, known as SDFIs, were also historically high in 2022.
“The operating surplus in SDFI was approximately kr530 billion (US$50 billion), while the corresponding figure for 2021 was kr182 billion (US$17 billion),” the Statistics Norway report cites.
The Norwegian state derives revenue from the country’s oil and gas reserves through taxes on oil companies, its direct stakes in oil and gas fields and infrastructure, and dividends paid by energy giant Equinor, which has a 67% stake.
Even with record revenues from the hydrocarbon sector, and household and corporate taxes, they remained the Norwegian government’s largest revenue source in 2022.
These taxes are estimated at kr1.6 trillion (US$150 billion), corresponding to just over 40% of mainland Norway’s GDP.
According to these data, government revenues in 2022 are estimated at US$342.715 billion.
The increase from 2021 is US$109.138 billion and contributes to a surplus of 26% of GDP, about US$162 billion.
The revenue increase is explained by exceptional growth in taxes and dividends from the oil sector.
In 2022, Norwegian government revenues soared, leaving public spending at less than 39% of GDP when it had been 47.5% in 2021 and 56.7% in 2020.
According to official data, the surplus would be around US$140 billion or kr1.45 trillion.
Norway, which has always had hydrocarbon exports as its primary source of income, saw explosive growth in the first year of the Russia-Ukraine war and came to dominate the European market.
The sources of gas imports in Europe varied considerably last year, leaving Norway topping the list of largest gas suppliers with 24.93% of the market share in November 2022, followed by Russia with 24.65%.
Qatar, the United States, and Nigeria share 25.72% of the remaining.
Russia, which used to dominate the market with its cheap gas transported by Nord Stream, fell sharply after the entry into force of sanctions against Russian oil and gas on December 5 and against Russian refined hydrocarbons on February 5.
Its market share in Europe collapsed, although it has started exporting to new players such as India, China, and other countries in the region that are routing their Russian oil purchases to Europe as intermediaries to bypass the sanctions.
With information from Derecha Diario