Public transcript

How Norway manages its $2.25 trillion fund

By: Council on Foreign Relations
Length: 2 min
Published: 28 September 2026
Language: English
Text from: the audio
Transcribed: 1 October 2026

Read the full transcript Open on YouTube

Notes in English.

Summary

In this short interview, Norway's Prime Minister explains how the country's $2.25 trillion sovereign wealth fund converts oil and gas revenues into a permanent financial asset for future generations. The government only spends up to 3% of the fund's annual returns, never the capital itself. Unlike strategic Gulf funds, it operates as a broad index fund holding small stakes in 7,000 to 8,000 companies worldwide, governed by ethical guidelines that are now under review.

Key points

Norway's sovereign wealth fund has reached two and a quarter trillion dollars, roughly half a million dollars per Norwegian.
Oil and gas revenues flow into the fund rather than the government budget, insulating the budget from oil price swings.
The government spends only 3% or less of the fund's interest each year and has not spent any of the fund's capital.
The fund is designed to last forever and benefit future generations, particularly future pensions.
Unlike Gulf sovereign wealth funds, it takes no more than roughly 1 to 3% stakes in companies and holds shares in about 7,000 to 8,000 companies as an index fund.
The fund follows ethical guidelines, avoiding companies that violate basic international conventions, such as tobacco companies.
A review of the fund's ethical principles is underway so it reflects the values of the Norwegian people.
The Prime Minister notes it is harder to explain why you cannot spend money that you do have than money you don't have.

Questions it answers

00:00The size of the fund

How large is Norway's sovereign wealth fund relative to its population?

The fund has reached two and a quarter trillion dollars for a country of about 5 million people, close to half a million dollars per person.

The fund stands at $2.25 trillion.
That is roughly half a million dollars per Norwegian.

00:25How the fund works

How does Norway use its oil revenues and the fund's returns?

Oil and gas revenues go into the fund rather than the government budget, and the state spends only 3% or less of the fund's interest each year. The capital is preserved to fund future pensions and future generations, intended to last forever.

Oil revenues bypass the budget entirely.
Only interest, capped at 3% a year, is spent.
The fund is meant to exist forever.

01:15Investment approach and ethics

How does Norway's fund differ from Gulf sovereign wealth funds?

It is an index fund holding no more than roughly 1 to 3% stakes in about 7,000 to 8,000 companies worldwide, rather than taking strategic control. It follows ethical guidelines, avoiding companies that violate basic international conventions, such as tobacco companies, and those guidelines are now under review.

Small stakes in 7,000 to 8,000 companies as an index fund.
Ethical exclusions include tobacco and coal-related companies.
A review of the ethical principles is underway.

02:11The political challenge

What is difficult about explaining the fund to the public?

The Prime Minister says it is easy to explain that a government cannot spend money it doesn't have, but much harder to explain that it cannot spend money it does have.

Fiscal restraint is hardest to communicate when the money exists.

Notes

Purpose of the Fund

Norway's sovereign wealth fund has reached two and a quarter trillion dollars, serving about 5 million people — close to half a million dollars per person.\n- The current generation is transferring value from energy sales, mainly to Europe, into a fund that will fund future pensions in Norway.
Oil price fluctuations do not affect the government budget; revenues go directly into the fund.

Spending Rules

The government can spend 3% or less of the fund's interest per year.
No money from the fund's capital itself has been spent — only part of the interest.
The fund is meant to be there forever, for future generations, if it is well protected.

Investment Strategy

Unlike strategic sovereign wealth funds in the Gulf, Norway never takes more than roughly 1 to 3% shares in a company.
It is an index fund owning shares in about 7,000 to 8,000 companies around the world.

Ethical Guidelines

The fund is supposed to invest in countries that respect basic international conventions.
It avoids companies that are heavily invested in coal and tobacco companies.
A review of these ethical principles is underway so the fund — owned by all Norwegians and future generations — lives up to the values of the Norwegian people.

Political Challenge

The Prime Minister observes that explaining the government cannot use money it doesn't have is easy; it is harder to explain it cannot use money that it does have.

Transcribed automatically from the audio. Summary and notes written by AI from the transcript, so check anything important against the recording.