OSLO, March 8 (Xinhua) -- The Norwegian government said Friday it is proposing to exclude exploration and production companies within the energy sector from the country's sovereign wealth fund to reduce the aggregate oil price risk.

The Norwegian fund, formally known as the Government Pension Fund Global (GPFG), is ranked as the world's biggest sovereign wealth fund.

Companies classified as exploration and production companies by the index provider FTSE Russell will be excluded from the GPFG's benchmark index and investment universe, the Norwegian government said in a statement.

"The objective is to reduce the vulnerability of our common wealth to a permanent oil price decline. Hence, it is more accurate to sell companies which explore and produce oil and gas, rather than selling a broadly diversified energy sector," Minister of Finance Siv Jensen was quoted as saying.

The proposal will serve to reduce the aggregate concentration risk associated with this type of activities in the Norwegian economy, but this assessment does not reflect any specific view on the oil price, future profitability or sustainability of the petroleum sector, the statement added.

The Norwegian government noted that this assessment is thus independent of its current petroleum policy, which remains unchanged.

"The oil industry will be an important and major industry in Norway for many years to come. The state's revenues from the continental shelf are, as a general rule, a consequence of the profitability of exploration and production activities," Jensen said.

"Therefore this measure is about diversification," she noted.

The energy sector is a broad sector, and comprises integrated companies with businesses throughout the value chain as well as pure play renewable energy companies, the Norwegian government said.

"It is anticipated that almost all of the growth in listed renewable energy over the next decade will be driven by companies that do not have renewable energy as their main business. The Fund should be able to participate in this growth," Jensen said.