Norsk

Two hundred and fifty thousand Norwegian jobs depend on oil [1]. These jobs are expensive; require high skills and pressure salary levels in general. For small countries like Norway this many oil jobs might be a recipe for financial disaster. Norway might be heading for Dutch [2] disease [3] and “kuwaitisation” in the sense that an increasing group of cheap immigrant workers take over important parts of the labour market.

The major political parties seem to have handed over the control of Norwegian economy to Statoil oil company. The main prime minister candidates say they are concerned about uniformity in the Norwegian economy, and mention in passing that the world’s biggest challenge is global warming. In practice, they seem unable to change their policy. The oil industry vacuums the Norwegian labor market for skilled labor. Since skilled labor no longer is available locally, immigration must increase [3a].

Wage levels in the oil sector are far above all others. According to the government, hourly rates are now 69% higher in comparison to the main trading partners in the EU [4a]. Norwegian companies are therefore squeezed abroad whereas low paid workers and unskilled hands arrive from other countries, establishing a second-rate foreign working class in a “kuwaitisation” process. Even Statoil begins to flag out their own jobs [4b].

Depending on high oil prices
Oil economy needs high oil prices. It is therefore a hidden goal to prevent development of alternative energy sources. Along with petro tyrants in the Middle East and carbon barons in Texas, it appears that the oil sector tries to slow down the expansion of renewable energy [5]. We see oil magnates like George Bush [6] and the Norwegian energy minister in cozy visits to extreme Islamist petro tyrants in Saudi Arabia, Kuwait, the UAE and Uzbekistan. Norway is well behind other European countries with regard to renewable energy. This is connected.

Unfortunately for the oil economy, oil importing states such as Germany, Sweden, Finland, Denmark, California and China systematically work to get out of oil dependency. Since oil and coal are non-renewable resources, they eventually come to an end. The most readily available sources go first. Then more expensive and unconventional sources wait in line. Costs, especially external ones, increase for marginal sources, while profit margins decrease. Oil becomes more expensive, while the alternatives become cheaper. The oil sector is therefore a sunset industry, while renewable energy is a sunrise industry.

Continued investment in the oil requires that climate policy fail
Several countries want an effective climate agreement that will increase the price of fossil carbon. Oil demand could decline rapidly and profits fall dramatically. Statoil now obtains almost $ 110 per barrel [7]. Will Norwegian economy manage a world market price below $50 dollars a barrel? Are Norwegians so distinctive creative and productive that high salaries in other sectors can be justified?

It is risky to stand on only one big economic leg while Norwegian companies that could step in are on their way out of the country. Investments are made far too much in the oil sector only. This situation is a symptom of Dutch disease. What do politicians do with the patient who is apparently well? – Responsible policy must be to prevent the Norwegian economy growing into a bubble.

Statoil and other oil companies apparently accept an upcoming global warming of 3-4 centigrades. Since Norwegian politicians seem unable to set limits for the oil industry, oil companies do it themselves. Statoil is responsible for their own bottom line, not for what is best for Norway. Avoiding two degrees [8] warming now requires a miracle.

It is not safe to increase the global average temperature by two degrees [9]. On the contrary, the damage will be extensive even with only one degree increase. In addition to more extreme weather events [10], droughts and floods, more CO2 in the air means also increasingly acidic [11] and warmer seas.

If we manage to halt the global warming below two degrees, one can still hope to avoid dramatic changes. Over two degrees, we will almost certainly reach one or more tipping points [12]. In reality, the Norwegian policy accepts climate changes that will be devastating for future generations. We risk stealing the future from our grandchildren [13].

Most of the oil must remain
Statoil in theory accepts that two-thirds [14] of the world’s known oil reserves should be left to avoid climate disasters. They therefore argue that Norwegian oil production is more environmentally friendly than that of other countries. The production is top-notch, with well under 10 kg of CO2 emissions per barrel of oil extracted. But if the environmental argument is essential, Saudi Arabia extracts oil to slightly over 6 kg CO2 per barrel [15]. If Statoil wants to be perceived as more environmentally friendly, they should at least get out of unconventional oil sources such as tar sands in Canada, with up to 100 kg of extra fossil CO2 per barrel of oil extracted emitted to the atmosphere.

Deep inside we know that extraction of oil is not the main issue. The fuel consumption is. Every barrel of oil burned means 400 extra kilos of fossil CO2 to the atmosphere, regardless of origin. Currently, the world burns up nearly 90 million barrels of oil every day. Accumulation of CO2 in the air has already reached the two-degree limit: 400 ppm [16]. If you include the other greenhouse gases in the accounts we are up to 475 ppm [17]. If we add the extra 5 % increase of water vapor [18] in the air that man-made global warming so far has caused, we are fast approaching 500 ppm. Without action, a warming of over three degrees is probably already embedded in the system.

It is hazardous to let the Norwegian oil pension fund continue to invest in carbon-intensive activities. Norway must instead use the fund as a tool for a responsible climate policy, and invest in green technology.

The coming decade will probably offer the following:

1 Finland, Sweden, Denmark and Germany will halve their oil imports

2 Sun, [19] wind- [20]  wave- [21] and geothermal [22] energy will be cheaper than coal and oil energy [23a]. Energy efficiency will become big business [23b]

3 Hydrogen [24] is growing quickly as new energy source

4 Battery technologies [25] will make further breakthroughs. The Nissan leaf 2024 model will run 800 km on one charge, and the car’s solar cells will recharge the battery after 6-8 hours in the sun

5 Global warming will accelerate and the consequences become increasingly evident [26a]. Criticism and resistance against fossil fuels will grow dramatically [26b].There will be Increasing emissions of methane from thawing permafrost and clathrates [27] in the Arctic, strongly increasing the global warming in feedback loops [28].

6 Standard new housing in 2020 will be active houses [29].

7 Growing refugee flows [30] due to climate change and resource conflicts

8 Impaired Norwegian economies because of over-investment in the oil sector and lack of investment in other sectors

Which Norwegian political party is responsible enough to say: “250 000 oil-based jobs are too much for the Norwegian economy. Climate change is real and must be taken seriously”?

Subsidies [31] in the form of state guarantees, tax cuts, special arrangements and other incentives for increased exploration and production must be phased out [32]. Those elected have to govern Norwegian economy, not Statoil, Aramco and Exxon. Norwegian economy should have more legs to stand on than the crumbling petroleum leg. Renewable energy, eco-friendly processing, fisheries, tourism, nanotechnology, robotics, green architecture, self-sufficiency and ICT are some of the natural priority areas for the future economy of Norway.