Norway's sovereign wealth fund posts record loss for 2022

Jan. 31 (UPI) -- Norway's largest sovereign wealth fund recorded a negative return of -14.1%, or $164 billion, last year despite spiraling oil and gas prices, the central bank announced Tuesday.

The Government Pension Fund Global's biggest losses came from the fund's holding in equities and fixed-income investments which saw returns of -15.3% and -12.1% respectively.

It was the fund's worst performance in 14 years -- but it was in line with global stock markets which also suffered their worst year since 2008.

"The market was impacted by war in Europe, high inflation, and rising interest rates,'' Norges Bank said in a news release.

''This negatively impacted both the equity market and bond market at the same time, which is very unusual. All the sectors in the equity market had negative returns, with the exception of energy," said Nicolai Tangen, CEO of Norges Bank Investment Management

The bank credited the falling value of the krone against several of the main currencies over the course of last year for helping buoy the fund's year-end value to $1.23 trillion, an increase of $63.8 billion. That compared with inflows of $107.8 billion.

The fund, which is known as the ''Oil Fund'' because it was established to invest the profits of the country's massive oil and gas sector. More than two-thirds of the fund -- 69.8% -- is invested in equities.

However, the fund did manage to deliver a return of 5.1% on its investments in privately held renewable energy infrastructure and 0.1% on its investment in privately held real estate.

Of the remainder, 27.5% is in fixed income such as bonds and commercial paper; 2.7% in unlisted real estate; and 0.1% in unlisted renewable energy infrastructure.