Paradox economy: Norway got rich from oil and today leads the transition to clean energy

Oil in the Norwegian strategy Although it is internationally recognized for its advances in clean energy, Norway remains a powerhouse in the sector. According to the International Energy Agency (IEA), the country is among the world's largest oil producers and occupies a strategic position in the international natural gas market. ? Data from the European Commission shows that Norway is currently the largest supplier of natural gas to the European Union, accounting for around 31% of the bloc's imports in 2025. ? In 2023, Norway and the European Union also signed a Green Alliance to expand cooperation in clean energy, industrial transition and environmental protection. It is in this context that the Norwegian government argues that maintaining oil and gas production is not incompatible with its climate objectives. According to the Ministry of Energy and the Norwegian Offshore Directorate, the sector continues to be the main one in terms of export value and public revenue, but it can also contribute to reducing emissions in other countries. In official communications, the government claims that replacing coal-fired plants with gas-fired plants can significantly reduce greenhouse gas emissions from electricity generation, in addition to improving air quality. It also maintains that gas complements renewable sources, such as solar and wind, whose generation depends on weather conditions. “As Europe increasingly incorporates intermittent renewable sources, the need for the flexibility that gas can offer to balance fluctuations in energy supply and ensure a reliable supply for consumers increases,” says the Norwegian government. This initiative, however, also raises questions. The International Monetary Fund (IMF) states that revenues from natural resources represent a "double-edged sword": they can boost economic development, but also create challenges for the management of public accounts and long-term growth. In the case of Norway, the organization considers that the country managed to build robust planning to manage this wealth over the last few decades. Still, he highlights that the abundance of natural resources can lead countries to concentrate efforts on capturing these revenues, reducing the focus on structural reforms and productivity, which can slow down the growth of activities outside the oil sector. Brazil's opponent: Norway participates in the founding of NY's first football team Financing the transition with oil wealth One of the main tools created by Norway to manage the wealth generated by oil and gas was the Government Pension Fund Global (GPFG), a sovereign fund that transforms this income into financial assets for future generations. According to the GPFG itself, the objective is to protect the economy from fluctuations in the oil market and preserve this wealth in the long term. At the end of 2025, the fund managed around 21.3 trillion Norwegian kroner (approximately R$11.2 trillion) — an asset equivalent to around 3.8 million kroner (R$2 million) per inhabitant. In addition to investing in thousands of companies around the world, the institution adopts environmental and social guidelines to guide its applications and gradually expands investments in renewable energy infrastructure. The transition was also facilitated by a characteristic of the country's electrical matrix. According to the IEA, around 89% of electricity produced in Norway comes from hydroelectric plants, which has favored the electrification of homes, industry and, more recently, transport. The most visible result of this strategy is in the automobile market. After decades of incentives, Norway has become a leader in the adoption of electric vehicles. ? The government has set a target for all new car sales to be emission-free models, supporting this change through tax benefits, expansion of charging infrastructure and stable rules over time. With the advancement of the electric fleet, part of these incentives has been gradually reduced to preserve public revenue. According to the IEA's Global EV Outlook 2025 report, this transformation is already having an effect on fuel consumption. Since 2021, the use of oil in road transport has fallen by around 12%, reflecting the replacement of vehicles powered by fossil fuels with electric models. In addition to the electrification of cars, Norwegian legislation sets mandatory targets to reduce greenhouse gas emissions. Municipalities also received instruments to create zero-emission zones, require environmental criteria in public works and expand waste management policies. And the oil industry itself started to incorporate initiatives to reduce its emissions: projects such as Hywind Tampen — considered the largest floating wind farm in the world — were developed to supply renewable electricity to oil and gas platforms in the North Sea, reducing emissions from production itself.