Norway favours stable energy prices
Ingvil Smines Tybring-Gjedde, Norway’s deputy minister of petroleum and energy, spoke about the need for a stable energy market in an interview
New Delhi: India wants to partner with Norway in areas such as trade and energy in the backdrop of Prime Minister Narendra Modi attending the India-Nordic Council Summit.
In an interview, Ingvil Smines Tybring-Gjedde, Norway’s deputy minister of petroleum and energy, spoke about the need for a stable energy market with the supply cut actions of Organization of the Petroleum Exporting Countries (Opec) and Russia helping in reducing the risks of future price spikes. Edited excerpts:
Do we see Norwegian state-run firms such as Statoil ASA partnering with Indian companies?
Statoil is a partly state-owned company, with 2/3rd of it owned by the Norwegian state. But even being the majority stake holder, we don’t interfere with the business…But what I see is for the Norwegian companies as a whole, and Statoil is one of them, is that India is a really interesting market. You have a huge population, which is growing fast and you need energy. And you also need to work together with foreign companies such as Statoil or other companies to make that happen.
India has kind of an interesting position also geographically. Because if you are a big producer in the Atlantic Basin, you also need to have some outlets in the east because of the demand and supply of different type of products. And India is the first market you meet going from the Atlantic basin to the Pacific basin. So, that’s in addition to the upstream potential in India. So, the interest is in the upstream sector and India is also interesting in the mid-stream.
While India has called for responsible pricing, Saudi Arabia has defended the cuts and said that it will not allow a global glut to build up. In this context how does Organization of the Petroleum Exporting Countries (Opec) plus one (Russia) work out for the energy markets?
It is interesting though (laughs). We are in favour of a stable price i.e. high enough to get the supplies on the market in the short, medium and long-term and low enough to provide affordable energy for all.
We are absolutely in favour of having a more stabilized market, not with the big ups and downs. And taking into consideration that there will be a big growth in demand in the future, the shale oil…will absolutely benefit and will take some of the increased demand for a couple of years. But the growing demand will continue and the shale oil won’t be able to deliver what they need. So, that’s why it is so important for us to invest in conventional oil and gas activities because we need to have robust deliveries for the coming demand in the years to come. We think that the actions of Opec plus one over the last year has reduced the risks of prices from spiking from two-three years from now. It helped the whole industry. Because if they haven’t done it, then prices will go much further down for a longer period of time. You get no investments and when demand keep on growing what then happens in the future?