The cuts that affect us all – Bergens Tidende

This morning let the Statistics Norway (SSB), the new figures, which confirm our expectations of a sharp drop in oil investment next year. When SSB asked oil companies for investment in August, the count showed investment of 185.3 billion kroner next year.

This is indeed 2.8 billion more than the same companies responded in May, but the trend is obvious : The Tremendous investment growth on the Norwegian continental shelf appears to be over. In fact, according to several chief economists that Norges Bank should revise down its forecasts for the Norwegian economy in light of the current numbers.

Estimates of oil investment is nearly 20 percent below the estimate for investment in 2014, which was submitted in August 2013, according to DNB Markets in a note. There is however a completely different direction than in recent years. According economy nettavisen E24 has oil investments increased about 15 percent annually until now.

There is thus a significant change of mood that can be deduced from estimates.

But remember: Faced with such large numbers it is easy to lose perspective. They now envisions abandoned and inactive oil installations must take on new glasses. This is about investment, not operational. The activity will still be high, but not so feverish it has been in recent years.

The reason why the oil companies, led by Statoil, now slows investment, is that the costs (expenses) has run amok, while oil prices ( income) has remained more or less steady. Had this continued, would profitability (what is left after income paid for expenses) disappeared, especially if oil prices were to head back down. It might therefore not proceed.

But the consequences of the line shift in the oil industry marked already. The media now renders dismissal letter, not record results. Companies have invested and invested, realizing suddenly that future workload is reduced. Those who are directly affected have no choice but to adapt, than so painful it is.

A recent example, which is unlikely to be the last, the dismissals of contractor Aibel.

The oil industry, however, is becoming so dominant that change affects all of us more or less directly. Government funding is for example completely dependent on the values ​​produced from the Norwegian continental shelf, not only through transfers from the Petroleum Fund, but also taxes collected from all those who work and operate in and around the oil industry.

Cost adjustments to the oil industry, which is read by SSB figures today, tomorrow will be cost adjustments for all of us. The question is whether our elected officials will go forward as hard as a group, or if they will let it go and scour the Oil Fund in the back.