The recent parliamentary elections in Norway have strengthened the political position of the offshore oil and gas industry. A large majority of the population maintains a positive attitude toward the sector, as only two minor parties advocate for its discontinuation. The resulting Labour minority government, through budget negotiations, has secured a more stable parliamentary base, allowing for a freer hand in petroleum policy and potentially opening the door for more licensing and exploration.

Economic and Strategic Importance

The industry is Norway's major economic activity, providing many well-paid jobs. Since the early 1980s, all oil and gas revenues have been invested in a sovereign wealth fund. Although less than 3% of the fund is transferred to the national budget annually, it financed about a quarter of the budget in 2025, underlining its critical fiscal role.

Mature Province and Future Resources

Norway is a mature oil province with 60 years of activity. Official estimates indicate 56% of expected recoverable resources have been produced, with 22% yet to be proven. Notably, about 60% of the oil in place has been extracted, compared to only 45% of the natural gas, signaling a future shift toward increased gas production and export. The resource base is spread across three key areas:

• The North Sea: The center of activity with established infrastructure. It is mature, with three-quarters of the oil in place already lifted, though major finds are still possible.
• The Norwegian Sea: Contains petroleum-prone areas, but some are closed for fisheries reasons. About half of both oil and gas resources have been produced.
• The Barents Sea: Has more modest water depths but is remote with little infrastructure and limited geological knowledge. More than half of its estimated resources are in unopened areas, and it holds about 60% of Norway's unproven resources, representing significant potential.

Collectively, these areas may sustain oil extraction of around 2 MMbpd through 2050.

Policy Framework and Constraints

There is a general political agreement to continue oil and gas activity within the current framework, which respects limitations set by concerns for the fisheries industry. Attempts to open new areas are likely to face opposition, creating a potential for serious "fish versus oil" conflicts, though current activity and income levels may defer such disputes.

Market Realities and European Demand

Norwegian gas is sold primarily in Europe, with the EU (especially Germany) and the UK as major customers. Although these markets have declared intentions to phase out fossil fuels, realities suggest continued demand. The EU's shifting emissions targets raise questions about realism, and Germany's planned industrial electricity price cut, prioritizing secure and affordable energy over climate goals, undermines EU energy policy. This creates a larger German market for energy but also tougher competition from German industry, factors important for Norway's petroleum policy.