The future of hydrocarbons is becoming bleak if plans presented by international banks, representing around $47 trillion in value, will be fully implemented.
Around 130 international banks, all present at the UN climate change summit in New York, have committed themselves to decrease their support and investments in the oil and gas sector the coming years. The banking groups have signed the so-called Principles for Responsible Banking, which entails a promise by financial institutions to fully support the implementation of the Paris Agreement, by decreasing hydrocarbon investments while promoting renewables. This statement is going to be a major earthquake for oil and gas companies, threatening upstream and downstream operations worldwide, forcing oil & gas producers to either reduce their impact on the environment or to seek new sources of investment. It is already becoming more difficult for oil and gas companies to find new financing, and on top of this, a large group of institutional investors, representing a value of $11 trillion, are already actively divesting their oil and gas assets.