Norway refuses to cut gas price for Europe

Oslo will not force its firms to sell energy under fixed-price contracts, the petroleum ministry says

Norway will not demand that energy companies offer long-term fixed-price gas contracts as a way to alleviate soaring costs for European customers, Reuters reports, citing the country’s petroleum minister Terje Aasland.

He reportedly rejected the idea, voiced by a member of parliament that Norway should consider showing solidarity with Europe by instructing firms to offer fixed-price gas deliveries below current market prices. The minister argued that suppliers were already free to enter into long-term contracts if commercial terms were agreed with customers.

“I do not plan for a policy whereby petroleum firms on the Norwegian continental shelf are instructed to enter into fixed-price contracts for gas deliveries,” Aasland wrote in a letter to parliament late on Thursday, as quoted by Reuters. He indicated that Norway should instead focus on delivering as much gas as it can to meet soaring demand, and on remaining a reliable supplier.

The minister pointed out that 20 years ago Brussels had itself abandoned the practice of long-term contracts in favor of the spot market, and now the Norwegian system “keeps the option for companies to enter into such contracts, based solely on economic interests.”

Norway, which has overtaken Russia as Europe’s biggest gas supplier after Moscow cut flows, will curtail exports significantly next month due to heavy maintenance activity.

Find more stories on economy and finance in TROIB business