Norway's Election Too Close To Call, Germany's Too Dull to Register

Norway votes Monday in an election that has raised doubts about its future as a major oil producer, while Merkel continues her cruise to victory in Europe's biggest economy.
By Paul Whitfield ,

Norwegians head to the polls Monday in an election that is too close to call and which, for the first time, has seriously raised the question of the nation's future as a major oil supplier.

Final polls ahead of the vote gave the center-right governing party a one seat advantage as it seeks to become the first ever conservative administration to secure a second turn. Opposing it is a center-left coalition that includes the Norwegian Green party, which has pledged to halt Norwegian oil production within 15-years.

Norway's North Sea fields are one of the world's major oil producing regions, accounting for about 2 million barrels equivalent of oil and gas production per day, and a major source of energy for many European countries. Oil economics, and the fate of the oil industry, have dominated Norway's election cycle. The dip in oil prices in 2016, and resulting unemployment, pushed the center-left into an early lead that has disintegrated as oil prices stage a modest rebound and jobs returned.

The left hasn't been helped by a stumbling performance by Labor Party leader, Jens Stoltenberg, whose personal wealth and Harvard education has enabled opponents to cast him as an out of touch elitist. A revelation that he was invested in a hedge fund, that in turn invests in companies involved in nuclear weapon manufacturing was a particular blow.

Norway's Green party has also emerged as a major story. It's surge in support to an expected 4% of the vote could make it a king-maker. That has made its call for an immediate end to all new oil exploration and an end to production within 15-years a major talking point - though such a move remains highly unlikely.

Merkel on track for victory

Norway's close election contrasts with this month's other big European political contest, where the German coalition government of Angela Merkel appears to be coasting toward a fourth term.

Germans will vote on Sept. 24, with all polls predicting a comfortable win for the incumbent Chancellor, who is running for a fourth term. Merkel's center-right CDU/CSU is expected to win as much as 38% of the vote, compared to the center-left's 22%.

The election briefly looked a contest early this year, when the two parties were running neck-and-neck, but Merkel has pulled ahead in recent months as Europe's economy has picked up and following lack lustre debate performances by her opponent Martin Schulz, a former president of the European Union.

The predictability of the German election has meant, and will likely mean, that it barely rates a blip on the market's radar.

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