Published by Jessica Weisman-Pitts
Posted on December 4, 2024
4 min readLast updated: January 28, 2026
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By Terje Solsvik and Gwladys Fouche
OSLO (Reuters) -Norway’s government should let its huge sovereign wealth fund sell parts of its Russian portfolio when possible, ending a general freeze in place since 2022 that has prevented divestment, the central bank, which manages the fund, said.
The Norwegian finance ministry ordered a halt to all transactions in the fund’s Russian assets shortly after Moscow’s full-scale invasion of Ukraine in February 2022 and said at the time that the ultimate goal was to divest its holdings.
Norway’s $1.8 trillion sovereign wealth fund, which holds the windfall generated by its oil and gas production, is the biggest such fund in the world, holding 1.5% of global listed shares in companies.
The fund has so far been effectively barred from offloading Russian assets because it is not permitted to sell to counterparties under U.S. or EU sanctions.
While this means it is not possible to draw up a general divestment plan, the fund should now be allowed to sell Russian assets if and when opportunities arise, the central bank said in an Aug. 25 letter to the finance ministry released on Wednesday.
“Such an approach to seizing divestment opportunities would mean an end to the general freeze on the fund’s investments in Russia,” it said.
“Sanctions against Russia and countermeasures from the Russian authorities have escalated further in 2024,” the bank said in the letter, adding that “opportunities to sell Russian securities are currently very limited”.
Moscow considers U.S. and EU sanctions a form of economic warfare, and says calls to divest Russian assets are hostile acts of unfriendly states. Philip Gabunia, deputy governor of Russia’s central bank, told Reuters any decision to sell the assets inside Russia would require Moscow’s permission, granted only with “compelling grounds.
“If they want to sell in Russia, they must submit a request to our Russian governmental commission. Only after that will the matter be considered. Outside of Russia, they can sell to another foreigner, but it will also remain frozen,” Gabunia said.
The Norwegian fund follows ethics rules which can result in decisions to divest that have wider consequences because of its scale.
The fund’s Russian holdings were estimated at around $3 billion at the end of 2021, but the value has since dropped precipitously following a global writedown of Russian assets since the start of the Ukraine war.
The value of the fund’s Russian equity portfolio was estimated at just 1.5 billion crowns ($135 million) at the end of June this year, the central bank said in the letter to the finance ministry.
It has investments across 49 Russian companies, fund data showed, with the biggest holdings in Sberbank, Lukoil and Gazprom.
In addition, the fund holds Russian roubles worth some 3.2 billion crowns in its custodian Citibank account with the Russian National Settlement Depository (NSD), consisting of dividends received in the period since Feb. 2022, it added.
EVRAZ
Separately, the board of the central bank has ordered the fund to divest from London-listed Evraz, upon recommendation from the fund’s ethics watchdog, because Evraz produces steel in Russia.
The watchdog’s inquiries had shown Evraz “may be linked to the Russian defence industry as a supplier of steel which enables Russia to continue its unlawful war of aggression against Ukraine”, the watchdog said in a statement.
Already, Evraz was among the companies identified for divestment by the finance ministry.
“That means that we have not yet been able to sell the company,” said a fund spokesperson.
It was the first time the fund has announced a divestment before it has carried it out. Typically, the fund sells all its shares in a company before it says publicly it has done so.
Evraz did not immediately reply to a request for comment.
Unrelated to Russia, the fund announced late on Tuesday that it had sold all its shares in Israeli telecoms company Bezeq because the firm provides services in the occupied West Bank.
($1 = 11.0531 Norwegian crowns)
(Reporting by Terje Solsvik and Gwladys FoucheAdditional reporting by Elena Fabrichnaya in Moscowediting by Louise Rasmussen)
A sovereign wealth fund is a state-owned investment fund or entity that is used to manage the country's reserves, typically generated from surplus revenues, such as oil and gas production.
As of June 2023, the value of the Norwegian fund's Russian equity portfolio was estimated at approximately 1.5 billion crowns, significantly reduced from previous estimates.
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