Name: Norway’s Giant Fund Sounds a Warning on Iran | Bloomberg Businessweek
Uploaded: 2026-03-25T21:37:58.000Z
Duration: 7 min 36 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

This is Bloomberg Businessweek with Carol Massar and Tim Stenovec on Bloomberg Radio.

Okay, all credit to Carol Massar on this piece because she saw this—well, actually

But Carol saw this piece today on our planning call.

We all agreed we got to get him on the program." It's about the warning that the boss of Norway's Giant Sovereign Wealth Fund is sounding on Iran.

It's close to 10:00 PM there, so we appreciate you.

First, I just want to start with sort of a—it's an aside,

but I can't believe this was Nikolai Tanjin's first trip to the Middle East.

The piece is about much more than that, but that caught my eye, first off.

How has the head of this $2.2 trillion fund only been in the Middle East this one time in this year?

for this first visit to the Middle East to happen at the end of February, just hours before war breaks out, it's kind of incredible.

I think, honestly, it speaks to the fact that this fund, this huge $2 trillion fund, it's a kind of passive fund.

And as a result, it's really skewed to the US.

And so without trying to draw a direct link, I would say that maybe it's not so surprising that Tangen would have sort of only followed the path, let's say, to the Middle East that everyone else has taken from hedge funds to others.

I mean, he's pretty ensconced in Norway, so maybe has less of a kind of speculative bent when it comes to where he goes or the Middle East.

But clearly, what is surprising is that he would go just before war breaks out.

Let's talk about your conversation with him, Lionel, because what's interesting is, as you say, it's an index tracking investor,

but it is having to become more attuned to geopolitics.

Walk us through a little bit of what you wrote about his thinking about the world and how it may be or is changing as a result of this.

So I think that he was thinking a lot about complacency, I think, or about this idea that markets were calm.

Markets are a little less calm today, but still, overall, they're taking this in their stride.

And I think he sees his role—he sees his job—as also warning the Norwegian public, whose prosperity is tied to this fund, and

maybe global markets, too, about the worst that could happen or the kind of risks around the corner.

That's why there's been a lot of stress testing at his fund, really mapping out the worst-case scenarios even before war broke out.

And I think he really wanted to touch on those scenarios without predicting what's happening, mapping out potential scenarios.

And that's why he talked about inflation, the not unlikely, in his words, return of inflation, and

the fact that geopolitical tensions are clearly not going to calm down anytime soon.

Those were his two kind of big scenarios on top of all the existing worries that we might have over AI bubbles and private credit and all that.

So I think that's what he sees his role as, scenario planning and being able to say that to the market and to his stakeholders in Norway.

And perhaps maybe ironic isn't the right word,

but as you point out in your column, higher energy prices benefit Norway.

I mean, that's, after all, what this $2.2 trillion fund has been built on.

So if we do see energy inflation for an extended period of time, the country and its sovereign wealth fund could be a beneficiary of that.

He's a very careful speaker on this topic,

and he did want to make clear that for him and his fund, obviously, higher inflation, higher oil prices is, on balance, a negative, but, as you point out, is obviously a positive for the country and its oil revenues.

I should point out, though, that the fund accounts sometimes for 20 to 25 percent of the state's budget.

So there is a kind of feedback loop that's not entirely positive.

I mean, what struck you most in your conversation with him?

I mean, we, every day, are having so many conversations that, obviously, when it comes to the US war in Iran, how long this goes on?

We've already talked about the LNG market, the natural gas market, that there might be already it's going to be changed for years to come, just trying to figure out the timing and, overall, the longer-term impact.

as you say, he's very careful, but I mean, what struck you the most?

I think the fact that he sounded a bit different to everybody else in the room.

I mean, he goes out of his way to say he's not a prognosticator.

I do find it interesting that so many other fund managers in the room who were more active asset allocators were quick to say that this conflict would be confined to the region, would, in the long run, be manageable in terms of inflation.

And I hear a lot more voices, even today, saying, "Well, this war could be over when Donald Trump decides it could be over.

It's not going to get out of hand." So I was simply struck by the fact that here was someone who did not pretend to be a geopolitical analyst and did not pretend to be predicting what was going to happen, simply saying, "Well, okay, but

on balance, here are two risks that I'm putting in my scenario bucket,

and I'm not going to rule out the worst-case scenario." Given that the fund is passive and geared toward US equities, was there any discussion, or did it come up at all, about changing his investments or changing the investments as a result of geopolitics?

So it's mostly passive, but there is an active component.

So, for example, the speed at which they deal with certain issues, they've raised this in the past on certain banking stocks, banking crises.

As for the overall rules, they are up for debate.

They're up for review, actually, in Norway right now.

And I think that while I think for Americans, when they encounter the rule debate when it comes to the Norway Sovereign Wealth Fund, it's mostly about ethical guidelines and what some people disparagingly call woke investing, right?

Oh, disinvesting from or divesting from Israeli stocks, for example, or those exposed to Gaza.

I think what might be interesting, though, is if the rules change and there is more of a geographic diversification along with that, so more investment in Europe, that could be a really huge game changer, especially for Europe, where he was quite keen to publicly say, "Europe is a bit of a sleeping beauty.

It really has to get its act together, unify its capital markets, reform its economy." It could be quite interesting to see this fund that is so exposed to the US become less exposed to the US over time.

And listen, when we talk about where investment flows go, as you remind us, at the fund, about 1.5 percent of all listed shares is in its portfolio,

and you're talking about top holdings like Nvidia and Apple.

So you talk about the major exposure that it ultimately has.

but we so wanted to talk about your story and share it with our audience.

Lionel Laurent, he is a columnist for Bloomberg Opinion and highly recommend you read the full story.

It is out on The Bloomberg and at Bloomberg.com.