HSBC retrenches from oil and gas

British bank HSBC’s announcement that it will no longer finance new oil and gas fields has been welcomed by campaigning groups, including Insure our Future.

HSBC is the first major global bank to end funding for new oil and gas projects. However, it stressed that it will continue to offer corporate finance to energy sector clients whose transition plans are consistent with a net zero by 2050 commitment.

The bank is aiming for a 34% reduction in on-balance sheet financed emissions for oil and gas by 2030. It also requires a net zero by 2050 target from clients.

Becky Jarvis at Bank on our Future, responded to the news, saying: “HSBC’s announcement today is a huge signal to the oil and gas industry that their time is up. This is a result of years of hard work from the climate justice movement. It’s far from perfect, but it’s a sign that the dominoes are falling and confirms our unstoppable momentum. All eyes will now be on Barclays and the giant North American fossil fuel banks like Citi & RBC to catch up.”

According to campaigners, HSBC’s oil and gas policy raises the expectation that other global financial institutions will follow suit, with such a precedent-setting policy sending a strong message to Lloyd’s of London, who, like HSBC, has committed to net-zero goals.

Lindsay Keenan, European Coordinator of Insure Our Future, added: “HSBC is the biggest British bank and its new oil and gas exit policy sends a strong message to the whole City of London. Like HSBC, Lloyd’s of London has signed a net-zero commitment and needs to adopt an oil and gas exit policy for its insurance.”