Senator Lindsey Graham threatens Norway after wealth fund divests from Caterpillar

Norway's Prime Minister Jonas Gahr Store had to diffuse a diplomatic spat on Thursday after a US senator threatened to impose tariffs and/or deny visas to Norwegians after the country’s sovereign wealth fund announced it was divesting from an American company whose products are used in Israel’s war on Gaza.

Norway's $1.9 trillion sovereign wealth fund, the world's largest, said on Monday it had divested from construction equipment manufacturer Caterpillar Inc and five Israeli banks over human rights violations in Gaza.

Norway’s prime minister reached out to US Senator Lindsey Graham of South Carolina to explain how the wealth fund is run independently of the government in a text message, after Graham wrote two social media posts attacking and threatening the European country.  

Graham first attacked and threatened Norway on Wednesday on X.

“Your decision to punish Caterpillar, an American company, because Israel uses their product is beyond offensive,” he said. “Your BS decision will not go unanswered”.

Graham further inflamed the situation by saying on X on Thursday that “doing business or visiting America is a privilege, not a right”.

“To those who run Norway’s sovereign wealth fund: if you cannot do business with Caterpillar because Israel uses their products, maybe it’s time you’re made aware that doing business or visiting America is a privilege, not a right,” Graham threatened.

He warned Norway of potential tariffs or visa denials.

“Maybe it’s time to put tariffs on countries who refuse to do business with great American companies. Or maybe we shouldn’t give visas to individuals who run organizations that attempt to punish American companies for geopolitical differences”.

He urged Norway to reconsider its "shortsighted" decision.

His post sparked ire on X, with former United Nations secretary general Ban Ki-moon’s speechwriter, Mark Seddon, saying, “Do you really think that you can go all around the World, like the Mafia, making threats to all & sundry? Those days are rapidly coming to an end.”

Others online reminded the senator of the fact that American activist Rachel Corrie had been crushed to death by a D9 Caterpillar bulldozer in Rafah in Gaza in 2003, as she protested against the demolition of Palestinian homes.

The war in Gaza has been deemed a genocide by scholars and human rights bodies worldwide, with over 63,000 people killed by Israel so far, according to Palestinian health officials. The Lancet medical journal considers that a conservative estimate and said in a July report that the death toll could exceed 186,000.

Military

The fund held a 1.2 percent stake in Caterpillar, valued at $2.4bn as of 31 December. The value of the stake had slid to $2.1 bn at the end of June, as Caterpillar saw a 21 percent decline in profits in its second-quarter earnings, as it dealt with unfavourable manufacturing costs resulting from higher tariffs.

The fund’s ethics council advised the board of governors to sells it shares in the US company because “bulldozers manufactured by Caterpillar are being used by Israeli authorities in the widespread unlawful destruction of Palestinian property".

“There is no doubt that Caterpillar’s products are being used to commit extensive and systematic violations of international humanitarian law," the report said.

The report added that the company had not implemented any measures to prevent its use for these purposes and that the council considers "an unacceptable risk that Caterpillar is contributing to serious violations of individuals’ rights in war or conflict situations”. 

In its assessment, the ethics council said the Israeli military had utilised bulldozers manufactured by Caterpillar for decades, with only a brief pause between 2024 and 2025.

These machines were supplied to Israel through the United States foreign military sales programme and then modified by other parties for “military purposes”.

Last year, Norway's largest private pension fund also divested its stake in Caterpillar over its involvement in rights abuses in the occupied Palestinian territories.

Oslo-based KLP sold its shares and bonds in the company, worth $69m in June of last year.

Caterpillar did not comment on the divestment.