Norges Bank Investment Management, which runs Norway’s $2.3 trillion oil fund, recommended Friday that the government cut the share of government bonds in its fixed-income portfolio from 70% to 50%, with US Treasuries bearing the brunt of the reduction.
The recommendation reverses a position taken just five months ago when Jens Stoltenberg, who returned to Norwegian politics last year as finance minister after leading NATO, told the Financial Times the fund would keep significant US exposure, arguing Wall Street is too big for a fund NBIM’s size to sidestep.
Friday’s letter goes to the same finance ministry Stoltenberg now runs, recommending exactly what he said the fund wouldn’t do. CEO Nicolai Tangen and Governor Ida Wolden Bache of Norges Bank signed the letter.
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Under the plan, the bonds it buys instead — mostly US corporate debt — would grow from 16.2% of the portfolio to 27.6%, meaning much of what leaves Treasuries stays in US debt, just a different kind. The fund also wants to add mortgage-backed securities as an eligible holding, arguing they behave more like government debt than stocks during downturns.
Related: Foreign Holdings of US Treasuries Drop $72 Billion as Top Three Buyers Retreat
Among sovereign bonds, the fund holds more in US Treasuries than anything else — over 2,000 billion Norwegian kroner — well ahead of its Japanese and British government debt. NBIM also wants to change how it weights sovereign bonds, moving from a GDP-based formula to one based on market value, and said rising debt burdens throughout the developed world make it more likely some of that sovereign paper could eventually face restructuring or default.
Norway’s fund had been swimming against the tide. Nordic peers including Sweden’s Alecta and Denmark’s AkademikerPension began selling their US Treasury holdings over geopolitical concerns as far back as last year, while Norway’s fund kept adding to its Treasury position through the end of 2025.
Read: Sweden’s Largest Pension Fund Dumps $8.8B in US Bonds
Economist Mohamed El-Erian said the amount involved isn’t large, but warned that “traditional holders and buyers are becoming less reliable.”
The proposal still needs sign-off from Norway’s finance ministry, and past NBIM recommendations of this scale, like its push to drop oil and gas stocks, have also required parliamentary approval before taking effect. Separately, internal modeling put the potential hit from an AI-driven market correction at $740 billion, roughly 35% of the portfolio.
