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DNB

Norway braced for ‘catastrophic’ $30 oil

One of Norway’s most respected oil analysts has warned that the global oil price could hit $30 per barrel next year, adding that such a drop would be “catastrophic for Norway”.

Published: 13 August 2015 09:08 CEST
Norway braced for 'catastrophic' $30 oil
Statoil's Oseberg A facility. Photo: Harald Pettersen/Statoil
Torbjørn Kjus, an analyst for DNB Markets, cited the slump in China’s economy and high production from the Opec club of oil producing countries and US shale oil producers. 
 
“An oil price of $30 would be absolutely catastrophic for Norway,” he told Norway’s Dagens Næringsliv business newspaper. “We would not shut down out existing production, but there would be no more investment.” 
 
Kjus said that much would depend on how China responded to its economic problems, whether it would move to intervene and stimulate the economy or leave markets to run their course. 
 
Bjarne Schieldrop, a commodities analyst at SEB bank, agreed that prices could fall lower in the coming months. 
 
“American shale oil production has been much better than expected, despite lower oil prices, and OPEC production has increased sharply during the past year,” he told E24. 
 
The price of a barrel of North Sea crude has halved from $105 a year ago to $49 today. 
 

TAX

Exec at Norway’s top bank aware of tax haven use: report

One of the top executives at DNB, Norway’s largest bank, knew for five years that the bank’s subsidiary DNB Luxembourg helped customers set up companies in the Seychelles, VG reported.

Published: 12 April 2016 09:14 CEST
Exec at Norway's top bank aware of tax haven use: report
DNB's Rune Bjerke has been under increasing pressure from key politicians who were unsatisfied with the partially state-owned bank’s response. Photo:Håkon Mosvold Larsen / NTB scanpix
That goes against the bank’s claims that its current management knew nothing about helping clients set up companies in the tax haven. 
 
According to VG’s report, top executive Terje Turnes was part of DNB Luxembourg’s leadership between 2005 and 2010 and knew full well that customers were being offered help to set up firms in the Seychelles. 
 
Turnes is now DNB’s executive vice president for risk management, calling into serious question bank CEO Rune Bjerke’s claims that the use of tax havens was unknown to “management, board of directors and internal and external controls”. 
 
DNB apologized for its practices last week but stressed that the company did not break any laws or regulations. 
 
“That it was legal to create these kinds of companies does not mean that it was right for us to do it for these customers,” Bjerke said. 
 
Bjerke called the practice of helping customers establish companies in tax havens “a closed chapter at our business in Luxembourg”, but the CEO has been under increasing pressure from key politicians who were unsatisfied with the partially state-owned bank’s response to the revelations. 
 
A spokesman for Business Minister Monica Mæland said on Monday that the ministry would carefully go through the bank’s internal report on DNB Luxembourg’s practices. 
 
Despite VG’s report that Turnes was privy to the subsidiary’s practices, it’s unlikely that he will face any personal consequences. 
 
“Starting a witch hunt is less important than learning from the conditions that led to this practice being established,” Bjerke said on Monday. 
 
The DNB revelations came to light as part of ‘The Panama Papers’, a huge cross-border journalism collaboration that has been analysing millions of records held by Mossack Fonseca, an international law firm based in Panama.
 
Some 400 journalists from 80 countries pored through the Mossack Fonseca files, including emails, receipts, bank statements, copied passports and others – 11 million in all – for more than a year. 
 
According to Aftenposten, more than 200 Norwegians were listed as Mossack Fonseca customers. 
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