Europe’s Banks Fund $55 Billion for Oil and Gas Expansion
European banks are providing billions of dollars of funding to expand oil and gas production, a report on Feb. 14 showed, despite International Energy Agency (IEA) guidance against new facilities in order to slow global warming.
Last year, 25 of the region’s leading banks collectively provided $55 billion to energy companies planning to expand oil and gas production, responsible investment non-profit ShareAction said in the report.
Although that marked a fall from the $106 billion lent in 2020 and $83 billion in 2019, it was above the $49 billion and $50 billion amounts in 2018 and 2017, respectively.
An IEA report in May said there should be no investment in new oil and gas fields in order to have a 50% chance of capping global warming at 1.5 C above the pre-industrial average.
The financing comes despite 24 of the banks themselves pledging to decarbonize their loan portfolios, the report said, adding that HSBC, Barclays and BNP Paribas were among the biggest providers of finance in 2021.
ShareAction said it was calling on investors to demand the banks implement policies to restrict finance for oil and gas expansion and back climate-related shareholder resolutions in the upcoming season for annual general meetings.
Cutting supply as demand rises also risked negative social consequences, it said, adding that it was also important to distinguish oil expansion from gas, which had a useful role as a bridge fuel for countries moving away from more-polluting coal.
Feb. 21, 2022