Norway’s sovereign-wealth fund, the world’s largest, is selling shares of Caterpillar. The reason has nothing to do with profit or cash flow, but the war in Gaza.
The fund said there was a risk the U.S. machinery company had contributed to suffering in Palestinian territories, citing evidence Israeli authorities used its bulldozers to destroy property unlawfully. It is ditching its stakes in four Israeli banks, including the country’s two largest by assets, on similar grounds.
The divestments by Norges Bank Investment Management add to evidence that the war in Gaza is leading to Israel’s estrangement from Western allies.
The fund manages almost $2 trillion in stocks, bonds and other assets accumulated from Norway’s oil wealth, giving it an average stake of 1.5% in all listed companies globally. Run by a former hedge-fund manager, it has a muscular approach to investing, often pushing for changes at companies it owns or selling shares on environmental, social and corporate-governance grounds.
Norway’s fund held a stake of just over 1.2% in Caterpillar, valued at the equivalent of about $2.4 billion, at the end of 2024.
Caterpillar didn’t respond to a request for comment.
The office of Israeli Prime Minister Benjamin Netanyahu declined to comment.
Earlier this month, the fund said it would sell 11 of the 61 Israeli companies in which it owns shares after a request by Norway’s Finance Ministry to review its investments in the country. The order followed a political outcry over reports that the fund had bought shares of an engine company that maintains Israeli jet fighters.
“Israel’s growing isolation in the international community and within parts of the business community is a serious problem,” said Yohanan Plesner, a former member of the Knesset who is president of the Israel Democracy Institute, a think tank. He notes however, that thus far, Israel’s economy hasn’t been hit by divestment moves.
Investments in Israel by Norway’s oil fund have become a flashpoint ahead of elections due to take place next month. Jonas Gahr Støre’s Labour Party, which faces a stiff challenge from the right-wing opposition, relies on support from smaller parties to govern with a minority of parliamentary seats. Some left-wing politicians have pushed the fund to divest from Israel, or for Chief Executive Nicolai Tangen to resign.
