U.S. green funding cuts. Nearly $8 billion in “Green New Scam” funding across 16 states is being canceled, per the Department of Energy.
Oil prices fell for a third consecutive day, hitting a 16-week low, driven by fears over a potential U.S. government shutdown impacting the economy and uncertainty around OPEC+ output hikes versus rising U.S. crude inventories.
U.S. government shutdown continues, as Trump administration cuts funds for Democratic states. Russell T Vought, the White House budget director, said the administration would freeze $26bn in infrastructure funding earmarked for Democratic-run states. Vought said $18bn for transport projects in New York City had been put on hold to prevent it from being delivered on the basis of “unconstitutional DEI principles” – referring to diversity, equity and inclusion policies that have been harshly criticised by conservatives.
Vought said $8bn in “Green New Scam funding” for 16 states, including California, Washington and Hawaii, had also been cancelled. Trump administration officials also signalled that the US president would move ahead with his earlier threat to use the shutdown to implement mass layoffs, Al Jazeera reported.
Major banks globally are withdrawing from or diluting their net zero and ESG commitments. Key financial institutions, including Goldman Sachs, JP Morgan, HSBC, and Barclays, have exited the Net Zero Banking Alliance or delayed climate targets. Reasons for this shift include a perceived lack of tangible business value from previous ESG initiatives, cost-cutting pressures, and the difficulty in implementing and assessing climate-related risks.
Wall Street giant Goldman Sachs announced in the month after Trump’s election win it would exit the Net Zero Banking Alliance (NZBA), which was convened in 2021 by the UN Environment Programme finance initiative. Just months later in January, JP Morgan’s sealed a Wall Street exodus after Citi, Bank of America, Morgan Stanley and Wells Fargo all quit the group.
The exits of The Royal Bank of Canada, Bank of Montreal and Toronto-Dominion Bank at the end of January erased the fingerprint of North America on NZBA. The ripple effect has spread to London, where HSBC and Barclays both ditched the club over the last month.
The Prudential Regulation Authority’s (PRA) report said it observed a “common challenge among firms” in the “complexity involved in constructing and implementing CSA (climate scenario analysis)”. It added they face difficulty in “using the outputs from CSA to assess their overall exposures to climate-related risks”. “Data remain a significant challenge” the PRA said, with firms struggling to access information “on both climate projections and the data necessary to link those to their asset and lending portfolios”.
This included the likes of location data that without, banks were unable to effectively evaluate their exposure to physical climate risks, such as floods, heatwaves, or wildfires, which are tied to specific geographical areas.
/X, Al Jazeera, OilPrice, City AM/