Norway’s Sovereign Wealth Fund Divests from Israeli Energy Firm Over West Bank Fuel Operations
Norway’s sovereign wealth fund, the world’s largest, has sold all its shares in Israeli energy firm Paz Retail and Energy. The move follows concerns about the company’s role in supplying fuel to Israeli settlements in the occupied West Bank, which are considered illegal under international law.
Ethical Guidelines Drive Divestment
The decision, announced on Sunday, stems from a stricter interpretation of ethical standards adopted by the fund’s Council on Ethics in August. This updated stance focuses on companies contributing to the Israeli presence in Palestinian territories.
In its recommendation, the Council on Ethics stated that Paz’s fuel supply infrastructure supports Israeli settlements and therefore contributes to their continued existence.
“The settlements have been established in violation of international law, and their perpetuation constitutes an ongoing violation thereof,” the council noted.
Paz, Israel’s largest operator of petrol stations, runs nine such stations in the occupied West Bank. The company was not available for comment outside business hours.
Paz Follows Bezeq as Second Divestment
This is the second divestment related to the West Bank since the ethics policy change. The first was in December, when the fund divested from Israeli telecom company Bezeq.
These actions reflect a growing trend among European financial institutions to reconsider ties with Israeli firms or those linked to operations in occupied territories, particularly since the Gaza conflict began in October 2023.
Global Fund with Ethical Standards
The Norwegian fund owns 1.5% of all listed shares across 9,000 companies globally. Managed by Norway’s central bank under rules set by parliament, it is widely regarded as a global leader in ethical investment.
The Council on Ethics makes recommendations, but the final decision on divestment lies with the fund’s board.
Review of Other Companies Ongoing
In March, the watchdog revealed it had reviewed around 65 companies with operations in sectors such as energy, infrastructure, tourism, and banking. Most were cleared of wrongdoing, but two divestments—Bezeq and Paz—were recommended.
It remains unclear whether more companies will be subject to divestment in the future.
Last year, the United Nations’ top court ruled that Israel’s occupation and settlement activities were illegal and called for their withdrawal. Israel rejected the ruling, calling it biased and incorrect.
with inputs from Reuters