The rout in crude oil prices isn't hurting just the U.S. shale drillers that have ramped up production in recent years. It's also punishing one of the world's wealthiest nations: Norway.
The small Scandinavian country, known for its picturesque fjords and family-friendly social policies, is also a major petro-nation, accounting for more oil exports than any other country in Europe. That means that $45-per-barrel crude has been punishing for Norway, whose central bank said in a recent report that oil at levels below $70 "will have relatively substantial consequences" for its economy.
And that's certainly what the market seems to think.
Since oil's plunge began last fall, the Norwegian krone has seen a 12-year low; the country's national oil company, Statoil, has canceled projects and reported its first loss since going public in 2001; and the government has cut interest rates in order to stimulate the economy, signaling that further monetary easing could also be in the offing. Late Thursday in Europe, senior Norwegian officials were preparing for an emerging meeting on Friday to discuss plans for a potential stimulus package, according to multiple reports.
The anxiety over Norway is such that the noted hedge-fund manager Kyle Bass said at a recent investment conference in Oslo that the nation "trades like an emerging market because of its dependence on crude," sparking additional debate about the impact of cheap oil on both Norway and other crude export-driven economies, including Russia, Iran and Venezuela.