Nordea, the largest Nordic bank, has introduced a new restriction targeting liquefied natural gas (LNG) expansion, saying it will no longer provide project financing for any new LNG import or export terminal. This makes Nordea one of the few European banks to adopt such a measure on project finance. Generally, European banks remain strong supporters of LNG expansion, particularly in the United States. At a time when the energy crisis has shown the urgent need to reduce dependence on LNG \u2014 a fossil fuel which has severe impacts on climate, communities and biodiversity \u2014 European banks must end their support for LNG expansion by adopting policies that cover both project and corporate financing.<\/p>\n<\/div>
The current energy crisis is hitting gas and LNG markets hard. Regions heavily reliant on imported LNG, such as Asia and Europe, have been particularly exposed to price spikes (1). Once again, this crisis demonstrates that LNG prices are structurally volatile (2) and highly sensitive to geopolitical shocks (3). In response, governments and representatives in Asia (4) and Europe (5) are signaling their intention to accelerate the deployment of renewable energy and reduce their reliance on imported LNG. Nordea\u2019s new exclusion of financing for LNG terminals reflects this emerging shift (6). Yet, most European banks continue to support LNG expansion regardless of its consequences.<\/p>\n<\/div>