Norway: Industrial production rebounds to 5-month high in February
April 10, 2015
In February, industrial output climbed 2.6% over the previous month in seasonally adjusted terms, which was a significant improvement over the previous 2.9% contraction tallied in January (previously reported: -3.0% mom). The reading was the highest since September 2014. According to Statistics Norway, February’s expansion was mainly due to gains in oil and gas extraction services, chemical and petrol refining as well as the electricity, gas and steam sector.
On an annual basis, industrial production in February rose 1.9% in working-day adjusted terms. The reading contrasted the 0.4% decrease tallied in the previous month. February’s reading ended the downward trend seen in recent months; however, annual average growth in industrial production continued to fall from January’s 3.3% to 3.1%.
Industrial production in Norway is highly affected by oil and gas extraction; the category accounts for about 72.0% of the index. According to the Ministry of Petroleum and Energy, oil and gas production has been declining ever since reaching a peak in 2001. While the government is encouraging operators to increase the recovery rates from oil and gas fields, the attempts have been undermined by increases in costs and taxes, which have dragged down overall industry output.
Author: Robert Hill, Economist