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Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

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Report Slams European Banks For Financing Oil And Gas

European banks led by HSBC, Barclays, and BNP Paribas continue to provide financing for oil and gas exploration despite government efforts to reduce economies’ reliance on fossil fuels, a report by a nonprofit investment organization has said.

“Climate scenarios such as the IEA’s Net Zero Emissions pathway show that there is no room for investment in new oil & gas fields if the world is to limit warming to 1.5C,” the report, by ShareAction, said.

“Yet 25 European banks, all committed to Net Zero goals, provided $55 billion in financing to companies expanding oil & gas production last year,” the authors added.


It’s worth noting here that while the International Energy Agency did call for an immediate end to new investments in oil and gas exploration in May last year to advance is Paris Agreement goals, its October Oil Market Report called for the opposite, saying, “Shrinking global spare capacity underscores the need for increased investments to meet demand further down the road.”

The ShareAction report, however, focuses on the IEA’s Road Map to Net Zero, which argued that if we are to have a 50-percent chance of limiting global warming to 1.5 degrees Celsius, new oil and gas exploration must cease immediately.


Banks, however, are not heeding the warning, with the authors of the report saying that 25 of the largest European lenders provided some $400 billion in financing to big oil companies, including Exxon, Shell, BP, and Aramco since 2016.

What makes the findings of ShareAction significant is that 24 of these 25 lenders are members of the Net Zero Banking Alliance set up by the United Nations. Since joining the alliance, ShareAction said, these 24 banks had provided $33 billion to oil and gas companies. More than half of this total came from four banks: HSBC, Barclays, BNP Paribas, and Deutsche Bank.

By Irina Slav for Oilprice.com

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  • DoRight Deikins on February 14 2022 said:
    Hmm?, the Net Zero Banking Alliance doesn't permit them to invest where they feel their funds could be best used as long as their investments are net zero for CO2, or it requires that they NOT invest in fossil fuel production entirely?

    I think they should read the Net Zero Banking Alliance agreement again. But perhaps I have misread it. Anyone have a copy? (Non-carbon, of course.)
  • Mamdouh Salameh on February 14 2022 said:
    In May 2021 the IEA’s net-zero emissions 2050 roadmap called for an immediate end to new investments in oil and gas exploration. Yet, Its October Oil Market Report said that shrinking global spare capacity underscores the need for increased investments to meet demand further down the road. Since then the IEA has been calling on OPEC+ to boost production.

    How could international oil majors invest heavily in expanding global spare oil production capacity without securing financial support from banks? That is the real dilemma.

    Dr Mamdouh G Salameh
    International Oil Economist
    Visiting Professor of Energy Economics at ESCP Europe Business School, London

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