Norwegians are voting on the final day of a parliamentary election dominated by concerns over rising living costs at home and turmoil in international politics, with the ruling Labour Party narrowly favoured to remain in office.

A left-wing bloc of Labour and four smaller parties is seen winning 88 seats in parliament, three more than the minimum needed to secure a majority and down from a combined 100 seats in 2021, according to an average of recent opinion polls.

Casting his ballot in Oslo, Prime Minister Jonas Gahr Stoere said rising prices had been, in his opinion, top of voters' minds, but added that inflation and interest rates were now on their way down.

"This issue of your daily coping with expenses has been key," Stoere said.

"And then of course also what is around Norway with the war in Ukraine, the Middle East and how we secure our foreign policy in a predictable way."

On the right, the populist Progress Party, the centre-right Conservatives and two smaller groups look set to win the remaining 81 seats, but the race remains within the margin of error and could depend on how some of the smallest parties fare.

Inflation, taxes and the quality of public services were key issues in the campaign, and the outcome could have an impact on the oil and gas industry and power supplies to Europe, as well as the management of Norway's $2 trillion sovereign wealth fund.

But the wars in Ukraine and Gaza, and Donald Trump's return to the White House, also loomed large, and analysts said this could benefit Labour Prime Minister Jonas Gahr Stoere, a former foreign minister who presents himself as a safe pair of hands.

Labour Prime Minister Jonas Gahr Stoere. – AP

Voting in the two-day election concludes at 1900 GMT, followed by immediate exit polls and with final results expected by early Tuesday morning.

Labour was lagging in the polls at the start of the year but received a major boost in February from the surprise return to politics of former NATO chief Jens Stoltenberg as finance minister - a move dubbed "Stoltenback" in Norwegian media.

Stoere said that bringing Stoltenberg, a friend and three-term prime minister, into the cabinet had transformed Labour's prospects in the campaign.

"I picked the best team to turn things around," Stoere said.

Benjamin Tegelaar-Breiby, a 29-year-old software developer, said the integration of migrants, the war in Ukraine and the Palestinian cause were important to him, and that he hoped for a centre-left win in the election.

"I feel like the world is kind of crumbling around us and so I would like stability in Norway. That's kind of what I'm voting for," he said in Oslo.

While the election remains close, the left-wing bloc appeared to have momentum in the most recent opinion polls, Johannes Bergh, head of the national election studies program at the Oslo-based Institute for Social Research, said.

"So if you were betting, you would probably guess that the centre-left would win," Bergh said.

Ronny Moeller, a business owner from Oslo, said Norway's wealth tax was his biggest concern in the election, a common theme among parties on the right, which argue that the levy discourages investment.

"As the owner of a private company I have to pay tax on my assets regardless of whether I'm earning a profit," Moeller said.

• VOTE: Wealth tax key to Norway polls

At least nine political parties are expected to secure seats in the election but only the leaders of Labour, Progress and the Conservatives are candidates for prime minister.

Stoere has ruled since 2021 with the backing of the agrarian Centre Party and the Socialist Left, but opinion polls show he may also need to rely on the communist Red party and the Greens in a mix some analysts have dubbed a "tutti frutti" coalition.

Demands from Greens and Communists could include tougher restrictions on oil and gas exploration, more tax on the wealthy and high earners, and more overall spending from the country's sovereign wealth fund.

Labour is seen winning some 27 per cent of the vote, this month's pollofpolls.no average showed.

In the right-wing camp, former Prime Minister Erna Solberg of the Conservative Party hopes to return to power with promises of broad tax cuts, more police on the streets and public sector savings.

But as in other Western countries, voters are increasingly turning to more populist right-wing options.

Before the election, Sylvi Listhaug's anti-immigration Progress Party was polling at around 21 per cent of the vote, comfortably ahead of the Conservatives on 14 per cent.