Norway Wants To Trade Oil In Euros

Friday, February 24, 2006

With the opening of the Iranian Oil Bourse only a few weeks away Norway has come forward with the idea to establish an energy exchange where products would be traded in Euros. According to an article at that was translated by Bourse director Sven Arild Andersen said already in December that it would be advantageous to trade oil in Euros.
He sees such a venture as a strong competitor to the International Petroleum Exchange (IPE) situated in London.
From the article:
Bourse Director Sven Arild Andersen is fed up with Norwegian oil having to be traded in London and wants to have a commodities and energy bourse in Norway.
The Bourse Director believes that Norway already has the prerequisites for building up a Norwegian or Scandinavian energy bourse.
"This would in such case compete with the bourse in London. Why not have the ambition to outcompete the British petroleum bourse," says Sven Arild Andersen.
"Here, you could trade crude oil, natural gas contracts and establish derivatives for these products."
"In addition, we must set up a larger financial industry around this, as important in other large markets and employ many people. And which are important for the competencies that are needed beyond the extraction itself of oil and gas," says Andersen.
Andersen in of the opinion that Norwegian oil must be traded in Euros, which can be advantageous for international customers.
"We have performed market studies and both Russia, which is a large oil exporter, as well as the countries of the Middle East have large parts of their economies in Euros. They would be able to view such a bourse as a contribution to balancing their economies in a better manner than at present, where their products are traded solely in dollars," says Andersen.
The Bourse Director holds out the Scandinavian power bourse, Nordpool, as an example of how a successful bourse is constructed. And he believes that this ought to be included in a Norwegian or Scandinavian energy bourse.
"We currently have the leading power bourse in Europe. It is large, well-respected and efficient. Nordpool would be natural to consider as being important in the establishment of an oil and energy bourse," says Andersen.
The plans have been discussed for years, but have never gone past the stage of being just talk.
"We must get large Norwegian players onboard such as Statoil and Hydro, and even though the interest has been there, nobody has taken it further with great enthusiasm.
"There is now talk of a fish bourse in Norway and there certainly is no doubt as to whether we thus aren't in a position to build an energy bourse that would be much, much larger and for which we possess significant requisite competence to get up and running."
Does this rise the question when copper will be priced in Yuan?


Wikinvest Wire