Norway elects pro-oil, Labor-led coalition in advance of COP26 climate talks

(Bloomberg) --Norway’s opposition Labor Party is on course to oust the Conservative-led government after two consecutive terms in an election dominated by disputes over the Nordic economy’s dependence on fossil fuel.

A likely coalition led by Labor, headed by millionaire Jonas Gahr Store, is poised to secure a five-seat majority in the 169-member parliament, according to data on the election authority’s website early on Monday, with 98% of votes tallied at least once.

The vote is a key political test ahead of major climate talks set to start Oct. 31 in Glasgow, after a landmark United Nations-backed report urging drastic measures to end carbon emissions was thrust into the limelight of the election campaign in western Europe’s largest oil and gas producer. Store’s victory also means that social democrats will now lead all the Nordic governments, except for Iceland.

“In the course of the coming days, I will invite the leaders of all parties that want a change in government to political discussions,” Store, 61, a former minister of foreign affairs and healthcare, said at a party event in Oslo. “It’s natural to start with the Center Party and the Socialist Left, our preferred partners.”

A ruling bloc with the agrarian and eurosceptic Center and the Socialist Left would mirror a set-up that ruled for two terms starting 2005. While the latter wants to put an end to new exploration licenses, Store has signaled a compromise that will see drilling focused around already developed areas that may ease the way to a coalition.

Having studied at the Institut d’Etudes Politiques de Paris and taught at Harvard, Store campaigned to reverse tax cuts to finance more welfare for “ordinary” people and a “fair” climate policy. He admits the oil era will soon be over, but he’s against ending exploration.

The outcome means Store would most likely avoid having to seek support from fringe parties to put together a functioning coalition even as Labor’s showing was the weakest in two decades.  The Greens, who demanded phasing out the fossil fuel industry by 2035, trailed polls for a second election in a row, falling short of the 4% threshold for compensation mandates.

Premier Erna Solberg’s Conservatives stand to lose the most seats in parliament, even after she was helped by record spending from the sovereign wealth fund, the world’s largest. The richest Nordic economy on a per capita basis, which has topped Bloomberg’s Covid Resilience Ranking for the last two months, has weathered the pandemic better than most wealthy peers.

It’s appropriate “to congratulate Jonas Gahr Store with what looks like will be a clear majority for a change in government,” Solberg, known as a political friend of Angela Merkel, said in a speech at her party’s election night event.