The rise in offshore oil and gas operations, maritime shipping, and tourism in northern latitudes enhances the risk of oil spills to sub-Arctic and Arctic coastal environments. Therefore, there is a need to understand the potential adverse effects of petroleum on key species in these areas. Here, we investigated the effects of oil exposure on the early life stages of capelin (Mallotus villosus), an ecologically and commercially important Barents Sea forage fish species that spawns along the coast of Northern Norway. Capelin embryos were exposed to five different concentrations (corresponding to 0.5–19 µg/L total PAHs) of water-soluble fraction (WSF) of crude oil from 6 days post fertilization (dpf) until hatch (25 dpf), and development of larvae in clean seawater was monitored until 52 dpf. None of the investigated endpoints (embryo development, larval length, heart rate, arrhythmia, and larval mortality) showed any effects. Our results suggest that the early life stages of capelin may be more robust to crude oil exposure than similar life stages of other fish species.