The long-term reason is that they have not really done much in government. It's worth noting that the Progress Party's election programme was kind of insane: namely, it called for just privatising everything and abolishing the Oil Fund, then spending all the profits on a big infrastructure binge and huge tax cuts all over the place. Though there has been record dipping into the oil fund this government, the realities of low oil prices and being tied to the more cautious Hoyre meant these dreams were not reached. Not to mention the reliance on Venstre and Christian Democrats, who routinely pooh-pooh any populist stuff that Progress can think of.
The short-term reason is the young leader of the Centre Party is stealing their anti-EEA schtick. Except whereas Progress hate taxes, Centre hate wolves and urban folk.
A nice description of both the Progress Party and the Centre Party. The government's ongoing municipal reform, aimed to reduce the number of municipalities, has received much criticism, and is probably one of the key reasons behind the Centre Party's increase in support. The wolf debate has also received quite a bit of attention recently, and in addition to being a pretty important issue in intself for many farmers, it is also used by the party to emphasize how urban Oslo "elites" supposedly ignore the concerns of the periphery. I would be surprised if they were still polling these numbers in September though.
As for the EEA agreement, the Progress Party is actually still a supporter of it, and it has never featured prominently in any of their campaigns (although the EEA has received increased criticism within the party recently, it doesn't appear to be a major issue for its leaders.)
