Behold a once mighty sovereign wealth fund laid low(er) by plunging oil prices.
Bloomberg reports on Wednesday that Norway is predicting it will have to withdraw cash from its $820bn SWF for the first time ever as it deals with lower oil prices and budget holes. That move comes on top of a series of hits to the coffers of oil-producing states, notably Saudi Arabia, in recent months.
The unwind of the commodities complex is arguably playing out in two ways in global financial markets.
The first is a decline in the amount of petrodollars — money earned from the sale of oil — circulating in the global economy, which takes away a substantial source of demand for financial assets. The second is in the sudden revaluation of the worth of many business models that had been predicated on higher and higher commodities prices. Both those developments have implications for financial markets, especially in credit where investors have been more than willing to step up to fund the commodities supercycle.
Brazil Energy Insight 
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