HSBC, Barclays and Standard Chartered to expand their fossil fuel business despite all scientific warnings

HSBC, Barclays and Standard Chartered to expand their fossil fuel business despite all scientific warnings

Climate activist group Market Forces has accused HSBC, Barclays and Standard Chartered of continuing to provide billions of dollars in fresh funding to fossil fuel projects, despite increasingly urgent calls for drastic action on carbon emissions.

The organisation, which typically focuses on forcing shareholder action on environmental issues, says it has launched a project to monitor financing for oil, gas and coal activities in real-time, using data from specialist project finance journal IJGlobal.

Barclays and HSBC are “neck-and-neck for funding fossil fuels this year so far”, providing US$4.5bn and US$4.4bn respectively to non-renewable projects, it says, with Standard Chartered in third place having provided US$3.1bn.

“Despite full knowledge that the world can’t handle any further fossil fuel infrastructure, as laid out in the recent International Energy Agency (IEA) net zero report, these banks continue to finance fossil fuel companies and projects that are destroying the world’s hopes of meeting climate targets,” Market Forces says.

It says that the financial institution that has provided the most funding to the fossil fuel industry by November “will get a ‘special’ prize” at this year’s UN Climate Summit, COP26, which is taking place that month in Glasgow, Scotland.

The IEA report, published in May this year, issues a stark warning over existing climate pledges by governments. Even if fully realised, it says those plans “would fall well short of what is required to bring global energy-related carbon dioxide emissions to net zero by 2050 and give the world an even chance of limiting the global temperature rise to 1.5°C”.

The Paris-headquartered agency, whose membership includes many of the world’s wealthiest countries, calls for an immediate halt to investment in new fossil fuel supply projects.

Under its vision, no new oil or natural gas fields are needed, with robust growth achievable in renewable power sources such as solar and wind.

However, Market Forces says that in June this year, HSBC and Standard Chartered participated in a US$6bn bond issuance to Saudi Aramco, which it describes as “the world’s most polluting company”. HSBC also participated in a US$1.5bn bond to Qatar Petroleum “to expand their fossil fuel business despite all scientific warnings”, it says.

Barclays and Standard Chartered also supported a US$500mn refinancing effort for Adani Ports, which set up transport services for Australia’s “controversial Carmichael mega-coal mine”.

“So every time Barclays, HSBC and Standard Chartered finance fossil fuels, they are showing their warm words mean nothing,” the organisation says.

When contacted by GTR, a spokesperson for Barclays says: “We are aligning our entire financing portfolio to support the goals of the Paris Agreement – significantly scaling up green financing, directly investing in new green technologies and helping clients in key sectors change their business models to reduce their climate change impact.

“By 2025, we will reduce the emissions intensity of our power portfolio by 30%, and reduce absolute emissions of our energy portfolio by 15%. Increasing at pace, our capital markets business has already facilitated £46bn of green finance.”