By Irina Slav
The CEO of JP Morgan, Jamie Dimon, said that banks refusing to fund new oil and gas projects would be “the road to hell for America”. An unnamed senior executive at a U.S. bank is considering removing the organization from global green commitments due to legal risk.
Dimon highlighted the fact that the current energy crisis has led to rising emissions due to increased coal use as oil and gas was not available.
Cutting off investments in fossil fuels would be the road to hell for the United States. This is what JP Morgan’s chief executive Jamie Dimon said during a congressional hearing on a range of topics.
“Please answer with a simple yes or no, does your bank have a policy against funding new oil and gas products, Mr. Dimon?” Rep. Rashida Tlaib asked JP Morgan’s chief executive, after laying out net-zero plans that require a shift away from fossil fuels.
“Absolutely not, and that would be the road to hell for America,” Dimon said in response. He went further, as well, saying the country needed to invest more not less in oil and gas.
“We aren’t getting this one right. The world needs 100 million barrels effectively of oil and gas every day. And we need it for 10 years,” Dimon said, adding “To do that, we need proper investing in the oil and gas complex. Investing in the oil and gas complex is good for reducing CO2. We’ve all seen, because of the high price of oil and gas — particularly for the rest of the world — you’ve seen everyone going back to coal.”
Dimon’s statements come amid rising opposition among banks to increasingly stringent decarbonization rules, with some, including JP Morgan considering an exit from the Glasgow Financial Alliance for Net Zero, according to a recent report by the FT.
The reconsideration of their participation in the alliance came as a result of growing fears of litigation opportunities, rife in new climate-related requirements for the businesses they fund.
“I am close to taking us out of these global green commitments — I’m not going to allow third parties to create legal liabilities for us and our shareholders. It is immoral and irresponsible,” one unnamed senior executive at a U.S. bank told the FT. “What if we get it wrong, make a mistake or someone lies? Then the bank can be sued, that is an unacceptable risk.”
By Irina Slav for Oilprice.com