A view shows a gas flare at Portovaya Bay in the Gulf of Finland
A yacht sails past a gas flare at Portovaya Bay on the coast of the Gulf of Finland in the Leningrad Region, Russia August 26, 2022. Reuters

European banks risk jeopardising the path to net-zero carbon emissions and the growth of renewable energy unless they stop directly financing new oil and gas fields this year, investors managing assets worth more than $1.5 trillion said on Friday.

ShareAction said on Friday it had made the demand in letters sent to the heads of Barclays, BNP Paribas, Credit Agricole, Deutsche Bank and Societe Generale this week.

The responsible investment NGO, which is coordinating the letters, said the investor signatories include Aegon Asset Management, La Fran?aise Asset Management and Britain's Local Government Pension Scheme.

ShareAction said the five banks and Britain's HSBC rank as the largest European financiers of the top oil and gas companies expanding production between 2016 and 2021.

However, HSBC said in December that it would stop directly financing new oil and gas fields, joining other banks restricting asset financing, the NGO noted.

"Investors are putting these banks on notice that they will face ever increasing pressure if they don't act soon to reverse their financing of new oil and gas," Jeanne Martin, ShareAction's Head of the Banking Programme, said.

A Barclays spokesperson said the bank believed it could make the greatest difference by working with customers and clients as they transition to a low-carbon economy.

"This includes many oil and gas companies that are actively engaged and critical to the transition," the spokesperson said, adding Barclays was lowering its financed emissions from energy.

BNP Paribas said in an email it had unveiled new targets last month to "accelerate the transition to a low-carbon economy", including ending financing of new oil and gas exploration and production and cutting gas exposure.

Credit Agricole said it had already ended financing of new oil extraction projects, and that it had a plan to reach carbon neutrality by 2050.

Societe Generale declined to comment, but a spokesperson said the bank would assess the letter once its executives had received a copy. The spokesperson pointed to the French bank's targets to reduce exposure to oil and gas production by 2025.

Deutsche Bank did not respond to a request for comment.

Although banks have been tightening their lending criteria for fossil fuels as part of pledges to cut financed carbon emissions to zero by 2050, environmental groups say they are doing too little, too late.

The International Energy Agency said in 2021 that to reach net-zero emissions by mid-century, no investment into new oil, gas and coal supply projects was needed.