If Donald trump will cancel the sanctions against Russia, the Norwegian company in the oil and gas industry can rejoice

Sanctions against Russia hard hit by Norwegian companies in the oil and gas industry. If Donald trump to lift sanctions, it will have positive consequences for Norwegian suppliers, according to the organization Norsk Industri.


Norsk industri is closely monitoring the actions of Donald trump: is the new US President really thinks about the normalization of relations with Russia?

Sanctions against Russia affected not only fish. The Norwegian companies in the oil and gas industry also suffered. This is a report about the prospects of the market in 2017, presented by industry organization Norsk Industri

The report, in particular, based on data obtained from organizations that are members of Norsk Industri after the imposition of sanctions in 2014.

“Special limitations associated with the oil industry in the North and offshore to cause serious damage to Norwegian companies in the oil and gas sector, since they concern the very Foundation of many Norwegian enterprises and companies”, stated in the report.

It turns out that Norwegian companies are experiencing increased competition with other countries: “Companies see a turn in the industry, in which suppliers from countries not affected by sanctions, for example, from China, can get the advantage.”

In the future closed to Russia doors can lead to lower levels of the Norwegian qualifications. This will weaken the position of Norwegian industry in Russia, and “may weaken the possibility of obtaining jurisdiction in the slightly longer term for future projects in Canada and in Norway.”

It will be good

In an interview with Klassekampen Knut E. Sunde (Knut E. Sunde), Director Norsk Industri, emphasizes that the organization will not give advice to government on sanctions against Russia.

Sanctions against Russia were introduced after the in 2014 Russia annexed the Crimea.

But if Donald trump will cancel the sanctions, it will be good?

“It will be good for offshore companies, but does not speak Norsk Industri Norwegian security policy. We do not want to interfere in Norwegian foreign policy, no security policy,” says Sunde.

However, Norsk Industri thinks that Norway will follow the US example, if they normalize relations with Russia.

“If he (Donald trump — approx. ed.) will soften the current sanctions regime, as was promised, most likely, the EU will have to follow him, and the natural consequence for Norway will be to do as decides to do the EU. For the Norwegian companies in the oil and gas sector it would certainly be positive,” says the report.

Sunde says that at the time of the imposition of sanctions carried out several projects.

“A lot of the projects in industry are frozen. A number of projects were already implemented. Our businesses were at different stages,” he says.

Had to leave

The company Solstad Offshore is one of those who suffered from the sanctions against Russia. CEO Lars Peder Solstad (Lars Peder Solstad) says that because of the sanctions already difficult situation has become even worse.

“In the oil industry in General, a decrease in activity, and the fact that we have no access to the Russian market, makes the situation even more difficult,” says Solstad.

“We had to leave. After the sanctions were imposed, the work was no more,” he adds.

— That is, you will be fine, if sanctions against Russia will be lifted?

“All that b providesaboutmore activity — well,” he admits.

To bypass the rules

The report shows that different countries interpret the restrictive measures in different ways, and that there is a possibility to circumvent the sanctions with the reorganization, such as creating subsidiaries in Asia.

The Norwegian fishing industry also suffered greatly from anti-Russian sanctions. In 2013, Russia exported Norwegian fish worth 6.5 billion kroner, Norwegian salmon, there were 67% of the Russian market.

Now the situation is hopeless: “compared with 20 wagons loaded to the brim with fresh Norwegian salmon, Peresetsky the border between Norway and Russia in December 2013, for the entire 2016 directly in Russia has not exported any fish”, — stated in the report.


The Norwegian export to Russia:

• In 2016, Norway has exported to Russia goods and services in the amount of 2.2 billion kroons. In 2013, according to the Central statistics Agency, exports amounted to 8.6 billion kroons.

• Yesterday, the Association of Norwegian companies (Norsk Industri) submitted its report on the prospects of the market in 2017. The Association believes that the turnover significant changes will not occur, but that the level of employment in the industry in 2017 will be reduced.

• The report of the Association of Norwegian enterprises say that bad trade relations with Russia also harm other sectors of the Norwegian economy, not just the exported fish.

Not afraid of Breccia

The future looks more optimistic for the industrial enterprises that are not dependent on the oil industry and making good money at a low rate of the crown — such as Nordox.

However, the US turn toward protectionism is a concern.

“If trump will impose high customs duties on foreign goods, this will have very negative consequences for world trade and for us,” says CEO Lars Tomasson (Lars Tomasgaard).

However, he believes that after the British exit from the EU, Norway had negotiated with the British the agreement is beneficial for Norwegian producers of industrial products.

“Then we need an agreement that’s similar to what we have now. That I have too big concerns is not.”

Exports Nordox copper oxide, used for painting ships and as a pesticide in agriculture.

“If the US imposes such a duty, as suggested by trump, we may have to cease to sell our products. Then we will hope that American goods will face the same negative consequences, so we will have more opportunities in the market in Europe.”

While Nordox — the company was established in 1880 — things are going well. This is one of the few companies remaining from those factories and plants around the river Aker in Oslo, which once had so much.

“We are doing very well. We never had anyone sent to the unpaid leave. We are a competitive Norwegian industry, and we pay Norwegian”.