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US holding talks with Norway about the issue

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Norway's wealth fund said last week it divested from

Caterpillar ( CAT )

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Firms, institutions have faced protests over Israel ties

as

crisis in Gaza has mounted

By Kanishka Singh

WASHINGTON, Sept 3 (Reuters) - President Donald Trump's

administration said on Wednesday it was "very troubled" by the

divestment by Norway's $2 trillion wealth fund from U.S.

construction equipment group Caterpillar ( CAT ), adding

Washington was directly engaging with the Norwegian government

on the issue.

Norway's $2 trillion wealth fund, the world's largest and

operated by Norway's central bank, said last week it had

divested from Caterpillar ( CAT ) on ethics grounds over the use of the

company's products by Israeli authorities in Gaza and the

Israeli-occupied West Bank.

The fund's ethics watchdog said that in its assessment,

Caterpillar's ( CAT ) products such as bulldozers it manufactured were

being used by Israeli authorities "to commit extensive and

systematic violations of international humanitarian law" such as

the "widespread unlawful destruction of Palestinian property."

The fund said Caterpillar ( CAT ) has "not implemented any measures

to pre­vent such use". Caterpillar ( CAT ) has not responded to requests

for comment on the wealth fund's move.

"We are very troubled by the Norwegian sovereign wealth

fund's decision, which appears to be based on illegitimate

claims against Caterpillar ( CAT ) and the Israeli government," a U.S.

State Department spokesperson said.

"We are engaging directly with the Norwegian government on

this matter."

Trump ally and Republican U.S. Senator Lindsey Graham has

suggested Washington should impose tariffs and visa revocations

in retaliation.

Firms have faced protests over ties with Israel as the

humanitarian crisis in Gaza from Israel's military assault has

mounted, and images of starving Palestinians, including

children, have sparked global outrage.

U.S. ally Israel's post-October 7, 2023, assault on Gaza has

killed tens of thousands of people, internally displaced Gaza's

entire population and prompted accusations of genocide and war

crimes at international courts and from several rights groups.

Israel denies the accusations.

The latest bloodshed in the decades-old Israeli-Palestinian

conflict was triggered in October 2023 when Hamas militants

attacked Israel, killing 1,200 people and taking about 250

hostages, Israeli tallies show.