Carbon Bombs & Wall Street — A Deadly Duo

Energy
Thursday, September 29th, 2022 11:00 am EDT

In May, The Guardian published a report about carbon bombs, defined as “oil and gas projects that would drive the climate past internationally agreed temperature limits with catastrophic global impacts.” It details the plans the fossil fuel industry has made to start of oil and gas projects that will produce greenhouse gases equivalent to a decade of CO2 emissions from China, which has the distinction of being the world’s biggest polluter at the present time.

Here are the primary findings from The Guardian report:

• These plans include 195 carbon bombs, gigantic oil and gas projects that would each result in at least a billion tonnes of CO2 emissions over their lifetimes, in total equivalent to about 18 years of current global CO2 emissions. About 60% of these have already started pumping.
• The dozen biggest oil companies are on track to spend $103 million a day for the rest of the decade exploiting new fields of oil and gas that cannot be burned if global heating is to be limited to well under 2ºC.
• The Middle East and Russia often attract the most attention in relation to future oil and gas production but the US, Canada and Australia are among the countries with the biggest expansion plans and the highest number of carbon bombs. They also give some of the world’s biggest subsidies for fossil fuels per capita.

The analysis by The Guardian leads it to conclude that the world’s largest fossil fuel companies “are in effect placing multi-billion dollar bets against humanity halting global heating. Their huge investments in new fossil fuel production could pay off only if countries fail to rapidly slash carbon emissions. The lure of colossal payouts in the years to come appears to be irresistible to the oil companies, despite the world’s climate scientists stating in February that further delay in cutting fossil fuel use would mean missing our last chance ‘to secure a livable and sustainable future for all.’”

Carbon Bombs, War, & Wall Street

Putin’s war of aggression has been great for the fossil fuel companies, which have been taking advantage of the spike in fuel costs to rake in record profits. But while we may have harsh words for those companies who are getting rich off other people’s misery, Bill McKibben has peeled back the curtain to take a look at the bankers who are financing this madness.

While the world was focusing on the refusal by the head of the World Bank to acknowledge that human activity is a leading cause of an overheating planet by using the “I am not a scientist” cop-out during Climate Week at the UN, McKibben says Jamie Dimon, CEO of JP Morgan Chase bank (by market cap, the biggest bank that the earth has ever seen), was telling a Congressional panel that Chase had no plans at all to stop lending for the expansion of the oil and gas industry, and that in fact such a plan would be that would be “the road to hell for America.” He added that the world, far from cutting emissions in half by 2030, should produce at least 100 million barrels a day for the next decade, an increase on current production.

At the same hearing, Dimon refused to say whether his company was lending to Russian oil and gas companies. But Razom, a group of Ukrainian activists working to end both the climate crisis and the Russian invasion, has the answer. It told Bill McKibben, “Citi provides loans, bond issuance, and revolving credit to Russian oil and gas giants Lukoil and Gazprom and the trading company Vitol. HSBC holds shares in Lukoil, Tatneft, Novatek, Gazprom and Rosneft. JPMorgan invested billions in Putin’s oil and gas and holds high stakes in Gazprom, Lukoil, Sberbank and Rosneft. By maintaining ties to Russian oil and gas, these banks continue the war and genocide in Ukraine, as export of oil and gas provides more than 40% of the income of the federal budget of Russia.”

McKibben writes in his latest newsletter, “Let’s be brutally clear here, since it’s easy to get lost in a lot of obfuscation. The four big US banks — Chase, Citi, Wells-Fargo, and Bank of America — are also the four biggest oil and gas lenders in the world. They — followed closely by big Canadian banks — are the money lifeline to the industry that is overheating the planet and underwriting Russian fascism.” (Emphasis original)

Last May, Antonío Guterres, the head of the United Nations, had this to say about the fossil fuel companies: “Simply put, they are lying and the results will be catastrophic. Investing in new fossil fuels infrastructure is moral and economic madness. Climate activists are sometimes depicted as dangerous radicals. But the truly dangerous radicals are the countries that are increasing the production of fossil fuels.”

Ecocide & Climate Justice

Also in New York last week were organizers for a movement that seeks to make ecocide a crime recognized by the International Criminal Court. According to Global Observatory, “The proposed crime extends the possibility of prosecutions for environmental damage beyond the context of war, theoretically enabling individuals to be prosecuted for harms such as ocean damage through oil spills, deforestation, land and oil contamination, and air pollution.”

According to The Guardian, the leaders of the movement to make ecocide a crime are hoping it will be one more arrow in the quiver for those trying to rein in government level policymakers whose agendas are exacerbating the climate crisis, but there’s no reason why it couldn’t extend to non-state actors like corporations who are plotting to explode carbon bombs as well.

It is insanity to think that destroying the Earth’s ability to support human life by promoting more extraction and burning of fossil fuels is permissible because a small group of people can become fabulously wealthy by doing so. Can the world stop using fossil fuels overnight? Of course not. But neither can it continue with a business as usual attitude.

In the final analysis, fossil fuels are stored sunshine from millions of years ago. Scientists often refer to what is known as the carbon cycle. Sunlight allows plants to grow and sequester carbon dioxide. When those plants die, the carbon stored in them is slowly returned to the soil and the atmosphere. Many people analogize the process to a bathtub. Some water comes in from the faucet and some water goes out the drain. As long as there is an equilibrium, everything is fine.

But what we have today is that bathtub being filled by Niagara Falls with no offsetting increase in its ability to drain the sudden influx of excess water. The carbon released since the Industrial Revolution began 170 years ago has been sequestered for millions and millions of years. Adding it back into the system in what in geological terms is a blink of the eye is a huge shock to the Earth’s natural order. And people like Jamie Dimon laugh at us for wanting to correct the imbalance.

The Takeaway

As we reported last week, Mark Carney, a highly respected UK economist, has been pushing the fossil fuel companies and big banks to screw up their courage and commit to lowering carbon emissions. His movement was gaining ground until recently, when those companies began backtracking on their commitments. Bill McKibben reports a top supervisor of the European Central Bank explained the rush for the exits this way. “If banks do not meet the targets they have announced or follow the climate strategy they have communicated, they expose themselves to litigation and reputational risks.”

If those trifling matters can cause such panic in boardrooms, just imagine the turmoil that might ensue if a couple of them were frog-marched into secure vehicles to begin serving lengthy prison sentences. Maybe then those who would destroy the Earth with carbon bombs for their own personal enrichment would start singing a different tune.

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