OSLO, March 15 — Norway’s sovereign wealth fund, the world’s largest, said today it was unable to divest its Russian assets for now as ordered by the government due to the extended closure of Moscow’s stock exchange.

At the end of February, the government ordered Norway’s central bank, which manages the US$1.25-trillion (RM5.3 trillion) fund, to submit a Russian divestment plan by March 15 in response to the invasion of Ukraine.

The fund held some 27.4 billion Norwegian kroner (RM12.8 billion) in Russian equities, or 0.2 per cent of the total portfolio, at the end of 2021.

It said on March 3 it believed its holdings, mainly in energy stocks like Gazprom and Lukoil, were essentially worthless.

“Owing to closed markets and extensive sanctions, it is not possible to commence the sale at present,” the head of the fund, Nicolai Tangen, and interim central bank governor Ida Wolden Bache wrote Tuesday in a letter to the finance ministry.

The Moscow stock exchange has been kept closed since February 25 to avoid a crash following Russia’s invasion of Ukraine but is due to reopen next week.

In addition, Western sanctions adopted in response to the invasion have hit a number of oligarchs who would normally have been among those in line to pick up the shares.

In their letter, Tangen and Wolden Bache said they would provide recommendations “on the lifting of the freeze on our investments in Russia once markets are functioning more normally”.

“The divestment will have to take place over time”, they said.

Norway is not a member of the European Union but has adopted the same sanctions against Russia as the bloc. — AFP