RIYADH: HSBC, Barclays, and Deutsche Bank are still funding new oil and gas expansion projects, despite being part of a green banking group, according to UK campaigning organization ShareAction.
According to a report from the group, big banks in Europe have invested over $400 billion in companies expanding oil and gas production since 2016.
The report added that investors should urge banks to demand green plans from fossil fuel firms before giving funds.
Spokespeople for all three banks insisted their organizations are committed to working toward a low-carbon economy.
The report states that HSBC has put an estimated $8.7 billion into new oil and gas in 2021. The campaign group noted that Barclays has poured some $4.5 billion while Deutsche Bank has loaned $5.7 billion.
Some of the fossil fuel companies who received the funds are Exxon Mobil, Shell, and BP.
ShareAction warned that funding new oil and gas is a lose-lose for banks and investors.
Xavier Lerin, a senior research manager at ShareAction, said: “If oil and gas demand decreases in line with 1.5 C scenarios, prices will fall and assets will become stranded.
“On the other hand, if demand does not fall enough to limit global warming to 1.5 C, the economy will suffer from severe physical climate impacts.
“Either way, the value will be destroyed for energy companies, banks, and their investors.”
The International Energy Agency had recently warned that there is no room for new oil and gas fields.
The ShareAction report also noted that these banks are flouting their public commitment to the Net-Zero Banking Alliance, a banking alliance pledged to meet net zero emissions by 2050.
A HSBC spokesperson said the bank is "committed to working with our customers to achieve a transition toward a thriving low-carbon economy," the BBC reported.
A Barclays spokeswoman said the bank will “continue to focus on our ambition to become a net zero bank by 2050, and our commitment to align our financing with the goals and timelines of the Paris Agreement.”
She added that the bank has restrictions in financing new oil and gas companies in the Arctic.
A Deutsche Bank spokesman was reported as having said: “Carbon intensive sectors account for only a small share of our loan book and based on publicly available data our lending and underwriting activity in fossil fuels is significantly smaller than (our) global peers.
“Moreover, our aim is to support all of our customers as we transition to a net zero world.”