Financing Fossil Fuels to the Tune of 869 Billion: Unveiling Bank Support for Climate Crisis
In a damning report published by the Rainforest Action Network and allied environmental groups, the world's 65 largest banks have been criticised for committing an unprecedented $869 billion to fossil fuel companies in 2024, a staggering increase of $162 billion compared to 2023.
The report, which names JPMorgan Chase, Bank of America, and Citigroup as major contributors, highlights a dramatic reversal of a trend of declining investments since 2021. This funding, which includes $429 billion going directly to companies with plans to expand fossil fuel production and infrastructure, directly contradicts the scientific consensus that no new fossil fuel projects should be developed to meet global climate goals.
The increase in fossil fuel financing comes despite the International Energy Agency's (IEA) clear statement in 2021 that fossil fuel expansion must stop to limit warming to 1.5°C. Since the Paris Agreement in 2015, these banks have channeled approximately $7.9 trillion into fossil fuels, underscoring their critical role in sustaining the industry's growth.
The funding sustains projects linked to environmental harm and human rights violations, such as the JSW Utkal coal project in India, demonstrating social as well as ecological impacts. The ongoing commitment to fossil fuel finance by major banks represents a retreat from the climate commitments made at COP26 in Glasgow in 2021, posing a serious challenge to achieving the goals of the Paris Agreement.
The report further reveals that the financial sector is enabling the continued expansion of fossil fuel infrastructure, which directly contradicts the energy roadmap necessary to achieve net-zero emissions by 2050 and avoid catastrophic climate change effects.
The decision by 48 banks to increase their support for fossil fuel infrastructure expansion by $84.4 billion is particularly concerning. According to the IEA, no new fossil fuel projects can be started to meet the 1.5°C limit. The report states that JPMorgan, if considered a country, would be among the top 25 emitters on the planet.
The real cost of these decisions isn't measured in dollars, but in degrees of increasing global temperatures. Each oil pipeline funded reinforces extractive structures that displace communities, destroy ecosystems, and perpetuate a linear, dependent economy.
The report also reveals that several banks have withdrawn from the Net-Zero Banking Alliance, an UN initiative to decarbonize the financial sector. The decision by Canada's six largest banks to withdraw from the Net-Zero Banking Alliance is a particularly worrying development.
The emissions from the loans funded by these banks will result in new infrastructure, wells, pipelines, and power plants that will emit greenhouse gases for decades. The financial flows supporting fossil fuel expansion are already incompatible with any safe climate scenario.
Every fossil loan approved today is a fire that will be harder to put out tomorrow. The big question now is whether financial institutions are willing to use their power to halt climate collapse. The decision to withdraw from initiatives like the Net-Zero Banking Alliance is a message to the world that humanity's climate future may be sacrificed for immediate profits.
By 2024, 75% of global emissions came from fossil fuel burning, with atmospheric CO2 levels reaching record highs. The report concludes that the continued funding of fossil fuels by major banks is moving the financial system in the opposite direction of global climate goals. The real cost of this financing is not just financial, but also environmental and social.
- The report reveals that JPMorgan Chase, Bank of America, and Citigroup, among others, have invested a significant amount in fossil fuel companies, totaling $869 billion in 2024, inconsistent with the scientific consensus that no new fossil fuel projects should be developed to meet global climate goals.
- The International Energy Agency's (IEA) statement that fossil fuel expansion must stop to limit warming to 1.5°C is directly contradicted by the 65 largest banks, who have collectively channeled around $7.9 trillion into fossil fuels since the Paris Agreement in 2015.
- The funding from these banks sustains projects linked to environmental harm and human rights violations, and the expansion of fossil fuel infrastructure is incompatible with any safe climate scenario, posing a serious challenge to achieving the goals of the Paris Agreement.
