File Photo: A flare burns natural gas at an oil well on Aug. 26, 2021. AP
G20 nations last month agreed to end financial support for new unabated coal plants abroad, but Thursday's commitment is the first of its kind to include oil and gas projects.
The British-led initiative saw countries and financial institutions agree to "end new direct public support for the international unabated fossil fuel energy sector by the end of 2022".
"Investing in unabated fossil-related energy projects increasingly entails both social and economic risks... and has ensuing negative impacts on government revenue, local employment, taxpayers, utility ratepayers and public health," signatories said a joint statement.
Unabated fossil fuel projects are those that do not deploy technology to absorb the carbon pollution they produce.
Announcing the initiative, Britain's business minister Greg Hands said: "We must put public finance on the right side of history."
"Ending international funding for all unabated fossil fuels is the next critical frontier we must deliver on if we are to keep 1.5C within reach," he said, referring to the most ambitious Paris Agreement climate goal.
The International Energy Agency says that to keep 1.5C in play there must be no new fossil fuel projects -- domestic or overseas -- from today.