ING Rigids Oil And Gas Funding To Include Trade Finance, Midstream

Recently, Dutch lender, ING announced that it has again hardened its lending policy to the oil and gas sector, limiting funding to clients indulged in commodity or trade finance and “midstream” infrastructure.

ING, a main provider of commodity finance, declared it was attempting to pursue a methodology to further limit the volumes of traded oil and gas it provided funding in line with global environmental goals to further set targets by 2024.

Commodity trade finance covers several types of loans with most of them for less than a year, providing international movement of goods from wheat to gasoline. Till now, none of the largest TCF banks have brought climate-related limitations to this part of its lending book, stated ING, except Rabobank.

The aforesaid initiative of the bank to resilient its activity demonstrates the fact that the world should be less vulnerable and dependent on oil and gas — and is a sizeable portion of ING’s exposure to the sector — Anne-Sophie Castelnau, global head of sustainability stated.

“By carrying out our endeavors in this direction, we’re conveying a message to our clients that we are effectively participating in making moves towards decarbonising our portfolio and dynamically getting out of that industry.” She added.

ING stated that it would look to decrease the emissions associated with the volume of traded oils and gas it funds by 19% by 2030, in line with the international Agency’s Net-Zero Emissions by 2050 Roadmap.

ING also added that it will no longer facilitate dedicated finance to “ midstream “ infrastructure initiatives such as processing and stockpiling that helps new oil and gas fields to be created.

The bank’s financing to midstream oil and gas was about $14 billion at the end of 2022, with about 10% of that associated with new oil and fields and therefore covered by the new targets, Castelnau stated.

Last year, ING explained, it would not facilitate dedicated upstream finance to new oil and gas fields. Its openness to this section was recorded at 3.1 billion euros at the end of 2021.

“The idea is to consider feedback from the International Energy Agency (IEA) that the world doesn’t require new oil fields.” Castelnau stated.

Originally published at https://www.emeriobanque.com.