OSLO, Nov. 16 (Xinhua) -- Norway's central bank said Thursday it has recommended the removal of oil and gas stocks from the country's sovereign wealth fund to make the government's wealth "less vulnerable to a permanent drop in oil and gas prices."
The recommendation was made in a letter sent by Norges Bank to the Ministry of Finance, which said the government "aims to conclude on this matter in the fall of 2018."
The fund, formally known as the Government Pension Fund Global (GPFG), is ranked as the world's biggest sovereign wealth fund.
"This advice is based exclusively on financial arguments and analyses of the government's total oil and gas exposure and does not reflect any particular view of future movements in oil and gas prices or the profitability or stainability of the oil and gas sector," Norges Bank's deputy governor Egil Matsen was quoted as saying in a statement.
Since the establishment of the GPFG, Norges Bank has advised the Ministry of Finance on the fund's investment strategy. Norges Bank Investment Management is the part of the Norwegian central bank responsible for managing the fund.
The bank said its analyses of the oil price risk in the government's wealth are based on the government's future oil and gas revenues, the government's direct holdings in Norwegian multinational oil and gas company Statoil and the GPFG.
"The investments in the GPFG and the stake in Statoil result in a total exposure to oil and gas equities for the government that is twice as large as would be the case in a broad global equity index," Norges Bank said.
Oil and gas equities currently account for around 6 percent of the GPFG's benchmark index, or just over 300 billion kroner (36.6 billion U.S. dollars), according to the bank.
Norwegian Minister of Finance Siv Jensen said the issues raised by Norges Bank "are complex and multifaceted" and its advice requires a thorough assessment.
"The Government is responsible for the Norwegian economy as a whole and must take a broad and comprehensive approach to this issue," she was quoted as saying in a statement.
