The Norwegian Prime Minister, Mr Jens Stoltenberg, said last night he would stay in office if he could muster support in parliament, despite the worst election result for his Labour Party in nearly a century.
With about 32.6 per cent of the vote counted, government projections showed the Labour Party was heading for its worst election result since 1909.
"Parliament will meet at the start of October and by then we must have a clarification of what basis there is either for a government in which Labour takes part ... or whether a majority in parliament has decided otherwise," he told party supporters.
Labour, the dominant force in Norwegian politics for most of the 20th century, was likely to win 23.7 per cent of the vote, down from 35 per cent in 1997, according to a Local Government Ministry website.
But with the election result closely contested, it was unclear whether Labour would remain the biggest party in parliament or fall behind the opposition Conservative Party.
The opposition Conservative Party saw its share of the vote rise to 21 per cent of the vote from 14.3 per cent in 1997, according to the projections.
Voters are weary of paying high taxes despite their nation's North Sea oil resources.
Deeply split over how to reform its generous welfare system, Norwegians looked likely to drift to the right and elect a parliament of tiny parties that will struggle to form durable coalitions until the next election in 2005.
Many voters in this oil-rich nation fail to see why they should pay some of the highest tax rates in Europe when their country's crude output is worth about $7,000 a year for each citizen.
"I'm disappointed with the government," said 79-year-old pensioner Ms Kirsten Rustad, on her way to vote in Oslo under grey clouds and drizzle. "They tell us we're the richest people in the world and we can't even afford good hospitals and schools."
Voters believe that Labour has not done enough to improve schools, healthcare or pensions, even though a UN report in July found that Norway had the world's highest living standards. The economy is robust and unemployment extremely low.
The Conservatives have promised tax cuts of about 40 billion crowns (£3.9 billion) over four years and more cash for schools, alongside an overhaul of welfare spending and cuts in aid to developing nations. The far-right Progress Party suggests buying homes for the elderly on the Mediterranean to avoid harsh Nordic winters.
"There's a very good chance of a change of government," said the Conservative leader, Mr Jan Petersen, whose party has been out of office since 1990. Some voters, fed up with what researchers call a creeping "culture of greed", are dumping Labour for the more radical Socialist Left Party, which has had record support at up to 16 per cent in opinion polls.
Mr Stoltenberg says Norway, the biggest non-OPEC oil exporter, has to keep taxes high to bankroll welfare and argues that splurging with oil money would stoke inflation. Surplus cash is saved in a fund worth about $60 billion.