Oil and gas giants are sliding even further from their climate promises, with none of the major producers anywhere close to aligning with the Paris Agreement targets.
Financial think tank Carbon Tracker has published its latest report, Paris Maligned III, the first sector-wide update since the re-election of the Trump administration and paints a bleak picture for progress a decade on from the Paris Agreement.
It reveals how energy companies have ramped up fossil fuel commitments through new investments, rising production targets and weakened emissions goals.
Carbon Tracker found that nearly all major oil and gas producers are planning to boost output in the coming years, investing in new projects incompatible with the 1.7˚C global warming limit – and in many cases, even 2.4˚C.
European companies, once seen as climate leaders, have taken a sharp turn. For example bp, which held the top score in last year’s analysis with a lowly “D” grade, has now plunged to an “F” after walking away from its production reduction target.
Shell, TotalEnergies, Equinor and Eni also saw their scores drop following announcements to extend or expand their fossil fuel plans.
Eni, for instance, is aiming to grow production by 27% by 2030 and is expected to green-light the massive Verus gas field in Australia, which Carbon Tracker estimates could emit over one gigaton of CO₂ – a project deemed incompatible with even the weakest climate scenarios.
Not just Trump
The backsliding is not just being driven by Trump’s renewed support for oil and gas.
Carbon Tracker notes strategic shifts began earlier, citing bp’s first hints of its policy U-turn as far back as October. Factors like high interest rates and the energy crisis triggered by the war in Ukraine have also nudged companies back toward fossil fuel comfort zones.
Despite the regression, investor pressure remains strong in Europe.
Sarasin and Partners recently sold off its shares in Equinor and quit its lead role on the CA100+ investor engagement group, saying the company was prioritising short-term profit over sustainable capital creation.
Carbon Tracker warned investors that major oil and gas companies are increasingly exposed to transition risks.
It said the sector has offered “little evidence” it is willing or able to align with Paris goals, adding: “Investors with climate mandates will need to question continued positions in these companies.”
Even mainstream financial backers with no explicit green agenda should be wary. Demand for oil is expected to fall rapidly over the next 15 years, putting producers who are banking on business-as-usual squarely in the firing line.
