The carbon bubble "continues to inflate,” according to a new report from Carbon Tracker. And yet no major oil company has aligned its operations with the goals set out in the Paris Climate Agreement.

This is not just a matter of bad corporate behavior. The oil industry is charging ahead with oil and gas projects that completely defy climate targets, which means that they are taking on serious financial risk. "Companies who continue to sanction higher-cost projects which do not fit with a lower demand scenario risk destroying significant shareholder value through the creation of stranded assets,” Carbon Tracker warned. The more companies delay, the greater risk they take on.

The Paris goals call for limiting warming to "well below” 2 degrees C while striving for 1.5 degrees C. Companies have set out various goals of cutting their own emission, perhaps trimming methane emissions or using more efficient technologies and the like.

But the bottom line is that the carbon budget means the oil market will need to shrink. Carbon Tracker estimates that not only will reserves need to be left in the ground, but major oil and gas companies will need to slash production by 35 percent by 2040 in order for warming to be maintained at 1.6 degrees Celsius.

The industry is on track to blow past these targets. Carbon Tracker has been on this beat for a while, and most recently, found that the global oil and gas industry spent roughly $50 billion on projects since just last year that were not aligned with the Paris targets.

The latest report adds more granular detail, offering up additional company-specific analysis.

"We believe that companies cannot be considered ‘Paris-compliant’ if they are prepared to sanction assets that would take the world past Paris limits,” the Carbon Tracker report said at the outset. Global proved reserves vastly exceed what can be burned in order to meet the Paris climate targets. But more than that, recent investment decisions are an indication that the industry plans to take the world far beyond those targets.

The report used a "least-cost framework” to analyze which oil and gas projects around the world can survive in a low-carbon world and which ones cannot. In other words, the volume of oil and gas output needs to shrink in order to slash global greenhouse gas emissions, and costly projects will be the ones that have to be scrapped.

Carbon Tracker says this way of looking at the situation is both the cheapest way to achieve emissions reductions also the one that maximizes shareholder value.

The analysis focuses on the seven oil majors – ExxonMobil, Royal Dutch Shell, Chevron, BP, Total, Eni and ConocoPhillips. "For all seven, the only way to achieve future production reductions is by not sanctioning those project options” that are not compliant with a carbon-constrained world.

But the limits hit the majors in different ways. For instance, Royal Dutch Shell only needs to scale back production by 10 percent to align its operations with Paris. ConocoPhillips and ExxonMobil, on the other hand, face much more serious financial risks. Conoco will need to cut output by a whopping 85 percent and Exxon will need to reduce production by 55 percent.

"ConocoPhillips’ production in particular is impacted by the lack of sufficiently low-cost projects in their portfolio to replace rapidly declining shale and tight liquids production,” Carbon Tracker said.

Shell (10 percent reduction) and BP (25 percent reduction) are in a much better position.

"If companies and governments attempt to develop all their oil and gas reserves, either the world will miss its climate targets and assets will become ‘stranded’ in the energy transition, or both. The industry is trying to have its cake and eat it – reassuring shareholders and appearing supportive of Paris, while still producing more fossil fuels,” Mike Coffin, co-author of the report, said in a statement.