Energy Sector Should Continue to Drive Gains for Norway

Many international countries are getting tailwinds from a global vaccination move, but for Norway, an additional catalyst is the energy sector—a boon for ETFs like the Global X MSCI Norway ETF (NORW).

The fund is up 20% midway through 2021, and could be in for more gains thanks to Norway’s strong energy sector.

Per an article, “Norway is betting on offshore wind, hydrogen, and electrification to meet its commitment under the Paris Agreement, but its oil and gas sector will continue to play a major role in long-term job creation, economic growth prospects, and value for the country, the government said on Friday (June 11).”

“Norway, Western Europe’s largest oil producer, is preparing to face the energy transition, yet it believes that it can develop its petroleum resources to deliver low-emission production within its climate policy, the government’s White Paper ‘Putting Energy to Work’ showed,” the article added further.

It’s a viable move by Norway’s government given that oil prices have rebounded since last year’s catastrophe when prices plunged into negative territory.

“Retaining expertise and technologies in the oil and gas sector is also vital for the development of new industries and technologies such as carbon capture and storage, offshore wind and hydrogen,” Minister of Petroleum and Energy, Tina Bru, said in a statement.

“The main goal of the government’s petroleum policy – to facilitate profitable production in the oil and gas industry in a long term perspective – is firmly in place,” she added.

As per the fund description, NORW seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the MSCI Norway IMI 25/50 Index. The fund invests at least 80% of its total assets in the securities of the underlying index and in American Depositary Receipts (ADRs) and Global Depositary Receipts (GDRs) based on the securities in the underlying index. The underlying index is designed to represent the performance of the broad Norway equity universe.

NORW gives investors:

  • Efficient Access: Efficient access to a broad basket of Norwegian securities.
  • Targeted Exposure: The fund targets exposure to a single country.
  • A Strong 12-month Performance: NORW is up 20% since January.

NORW Chart

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