Fossil fever in Europe – how oil and gas investments are slowing down climate protection

Just one week before the start of the COP30 climate conference in Brazil, the environmental organization Urgewald presented its new Global Oil & Gas Exit List (Gogel 2025) – the world's most comprehensive database on oil and gas companies. The conclusion is alarming: 96 percent of all producers are expanding their fossil fuel activities, even though countries agreed at COP28 in Dubai to begin phasing out fossil fuels.

“Oil and gas companies are treating the Paris Agreement like a polite recommendation – not like a survival plan,” criticizes Nils Bartsch, head of oil and gas research at urgewald. The figures also speak volumes: The industry's short-term expansion plans are currently 33 percent higher than in 2021 – even though, according to the International Energy Agency, no new fields should be developed if the world wants to stay within the 1.5-degree corridor.

Urgewald also points to the growing gap between fossil fuel investments and climate finance: 60 billion US dollars flowed into the exploration of new oil and gas reserves in the past three years – 75 times the amount that industrialized countries have paid into the UN Loss and Damage Fund.

“This behavior is immoral and economically risky,” explains Fiona Hauke ​​of urgewald. She demands that regulatory authorities finally classify fossil fuel expansion as a financial risk.

Europe continues to rely on gas – especially Germany

The discrepancy between climate policy and reality is particularly evident in Europe. According to Gogel, companies on the continent are planning to expand their LNG import capacities by more than 50 percent. Germany is especially active, with new terminals in Brunsbüttel, Stade, and Wilhelmshaven.

The German government itself anticipates declining gas demand. Nevertheless, corporations like RWE, EnBW, and international partners are pushing ahead with multi-billion-euro LNG projects. "Anyone building new LNG import facilities is fueling the exploitation of new gas fields. In the long term, Germany is making itself dependent on fossil fuel autocrats," warns Moritz Leiner, energy campaigner at urgewald.

The expansion of new gas-fired power plants also contradicts the EU's climate goals. Projects with a capacity of 68 gigawatts are planned across Europe – 13 GW in Germany alone. For urgewald, it's clear: this is a fossil fuel "lock-in" that will delay the transition to renewable energies by decades. The Czech EPH Group, in particular – through its subsidiaries Leag and EPETr – is pushing into the German market with massive projects.

“The federal government’s planned power plant strategy is a free pass for the gas industry,” criticizes Leiner. Even a conversion to hydrogen is neither economically nor climate-friendly realistic in the foreseeable future.

Between return and risk: Why fossil fuels remain attractive. Despite the looming climate catastrophe, billions continue to flow into fossil fuel infrastructure. The reason lies in short-term profit incentives: Oil and gas companies still achieve enormous margins – supported by subsidies, weak regulation, and political uncertainties in the energy markets.

For many investors, fossil fuels are still considered a "safe investment," especially during times of geopolitical crisis. Even banks and insurance companies that emphasize sustainability remain deeply involved in oil and gas businesses, according to urgewald. Only two major institutions – BNP Paribas and Crédit Agricole – have consistently refrained from issuing bonds for extraction companies.

But this is precisely where urgewald calls for a change of course: "Money is the fuel of this crisis – and we must stop the flow," emphasizes Hauke. If capital continues to flow into new extraction fields, pipelines, or power plants, there can be no genuine energy transition.

Europe's contradictions: Climate leaders with a fossil fuel base

A look at Norway and Austria shows how deeply entrenched the fossil fuel logic still is. In Norway, for example, exploration spending is increasing by almost 50 percent, a third of it in the Arctic – one of the most sensitive ecosystems on Earth. At the same time, the country is presenting itself internationally as a climate leader.

The situation is similarly contradictory in the Black Sea, where the Austrian company OMV plans to develop new gas fields. According to urgewald's analysis, these projects would prolong Europe's dependence and create "expensive lock-in effects"—from new pipelines to fossil fuel heating systems.

Fossil fuel expansion as a global risk – also for Europe

The majority of the world's planned LNG and gas-fired power plant projects are still unfinanced, but it's already clear that the fossil fuel business model thrives on political incentives. Long-term offtake agreements, subsidies, and export credits keep the cycle going. Google data shows that many of the planned plants will remain in operation well into the 2050s – long beyond the EU's net-zero target.

As a result, billions in public and private capital would be tied up – with the risk of being stuck with “stranded assets” if the transition to renewables is accelerated.

What needs to happen now

Urgewald and its international partners are calling for a halt to investments in fossil fuel projects and clear EU regulations prohibiting the expansion of oil and gas infrastructure. According to Hauke, the financial sector must "draw a red line"—no financing for new exploration, LNG terminals, or gas-fired power plants.

At the national level, governments should reduce subsidies for fossil fuels and direct public funds specifically towards renewable systems, storage and energy efficiency.

Germany, the organization argues, could lead the way here: Instead of investing billions in LNG terminals and new power plants, the country must concentrate its resources on green electricity, the energy transition, and grid expansion. Only in this way can a fair contribution be made to global climate stability – and the way out of the fossil fuel dead end be found.