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Saturday, April 13, 2024

More oil found as pump prices soar

Norwegian oil company Statoil could report another major oil discovery on Monday, this time off the coast of Brazil. Gasoline prices at the pump in Norway, meanwhile, continue to soar, exceeding NOK 15 per liter late last week.

Statoil is finding more oil, but gasoline prices at the pump keep going up in Norway and elsewhere. PHOTO: Statoil / Harald Pettersen

It now costs the equivalent of around USD 11 per gallon to pump unleaded fuel at Statoil and most other stations around the country. High fuel taxes are now paired with high oil prices and the strong Norwegian currency, making it more expensive than ever to fill up a car’s tank in Norway even though Norway is a oil-producing nation.

While oil revenues and fuel taxes pour in to the national treasure, money is running out of the wallets of motorists. “I remember when it seemed painful to pay more than NOK 10 per liter (about USD 7 per gallon at current exchange rates),” Kjetil Balke told newspaper Aftenposten as he pumped gasoline at a large Statoil station in Sandvika, west of Oslo, on Friday. “Now it’s completely wild, NOK 15.11 today. I’m doing what most everyone else is, closing my eyes while I fill up.”

Oil sanctions against Iran, unrest in the Middle East and winter fuel demand are among factors driving up the price. Statoil raised its price for what’s called blyfri 95 (unleaded gasoline with 95 octane) to NOK 14.73 in early February. It was over NOK 15 by Saturday, before dipping back under NOK 15 on Sunday and Monday, when fuel prices often decline slightly.

Statoil, which recently has been finding lots more oil off Norway, announced one of its largest oil discoveries abroad last week and another on Monday. Exploration wells at Zafarani off Tanzania have revealed large gas deposits under the sea floor and Statoil’s exploration director Tim Dodson called it a “breakthrough” for African operations. The Tanzanian discovery could amount to 900 million barrels of oil and oil equivalents, although it hadn’t been determined whether extraction would be profitable since there’s not much market for gas in Tanzania. Most of it would need to be exported.

On Monday Statoil announced another oil discovery at the Pao de Acucar prospect, around 200 kilometers off Rio de Janeiro. That discovery is being described as “high impact,” meaning it has great potential.

Statoil estimated the discovery at around 250 million barrels of oil or oil equivalents and has a 35 percent stake in it, with Repsol Sinopec also holding 35 percent and Petrobras of Brazil holding 30 percent.

“Statoil has clear ambitions for expanding in Brazil through new exploration possibilities,” Statoil’s head of operations in Brazil, Kjetil Hove, said. “The Pao discovery will be an important contribution to our growth.”

Views and News from Norway/Nina Berglund

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