The Swedish Academy which awards the laureate for literature has cancelled the prize this year, after being entwined in allegations of sexual misconduct.
On May 4, the Stockholm-based organization that hands out the prize said its 2018 victor will be announced next year along with the 2019 victor.
Dorotea Bromberg, of Swedish publishing house Brombergs, which has published four Nobel laureates, including JM Coetzee, said the academy's postponement "was a pity", but understood the reasoning.
Olsson said on Swedish Radio that the academy had been in "full agreement" to postpone the 2018 award since "there really was no other alternative".
Arnault, who is married to academy member Katarina Frostenson, a poet who also receives financial support from the group.
Arnault is also facing the accusation that he touched Sweden's Crown Princess Victoria inappropriately at a Swedish Academy event over a decade ago.More news: Iran and Sri Lanka sign five agreements to increase bilateral cooperation
Bjorn Hurtig, the lawyer representing Arnault, has said his client denies the allegations.
"The present decision was arrived at in view of the now diminished academy and the reduced public confidence in the academy", it said in a statement yesterday.
In a damning statement last week following an investigation, the secretive institution acknowledged in a news release that it was "in a state of crisis following a period of strong disagreement between members over important issues".
A plaque depicting Alfred Nobel at the Nobel Peace Prize Ceremony 2008 in Oslo City Hall on December 10, 2008 in Oslo, Norway.
Two prizes for literature will be announced next year, one for 2018 and one for 2019.
"The active members of the Swedish Academy are of course fully aware that the present crisis of confidence places high demands on a long-term and robust work for change".More news: The Coca-Cola Company to Participate in Goldman Sachs Global Staples Forum
Arnault also has been suspected of violating century-old Nobel rules by leaking names of winners of the prestigious award - allegedly seven times, starting in 1996.
A number of academy members resigned in protest that Frostenson initially remained on the panel; others quit in protest at the treatment of Danius.
For only the second time in its history, the Nobel Prize in literature will not be awarded as a sex scandal engulfs the committee that gives out the prize.
BOGAARDS: So there would not be a determine made on the part of publishers to hold back a book because the Nobel Prize is not going to be awarded in 2018. The prize was postponed on seven previous occasions, six of which occurred during World War I and II.
The paper said these included Bob Dylan in 2016 as well as French author Jean-Marie Gustave Le Clezio in 2008 and British playwright Harold Pinter in 2005. "One of the circumstances that may justify an exception is when a situation in a prize-awarding institution arises that is so serious that a prize decision will not be perceived as credible", wrote Carl-Henrik Heldin, Chairman of the Board of the Nobel Foundation. American playwright Eugene O'Neill was awarded the 1936 prize a year later, in 1937, at the same time as that year's victor received his prize.More news: Possible tropical development in the Gulf
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