Banks ‘show true colours' with fossil fuel financing surge last year

Euronews

14 hours ago

The world's biggest banks increased their fossil fuel financing last year for the first time since 2021, a new report reveals.
The top 65 banks provided $869 billion (€751bn) to thousands of oil and gas majors in 2024 - the hottest year on record - representing a $162.5 billion (€141bn) jump from 2023.
Released today by a coalition of green groups, the annual Banking on Climate Chaos report ties this backwards trend to banks' rapid retreat from climate commitments.
'Distract, delay, deflect, and finally defect. If needed, rinse and repeat. Banks have used this playbook to keep themselves and the fossil fuel industry flush with cash, while loading the financial system with risk and running out the clock on keeping global temperatures from rising above 1.5C,' says co-author Allison Fajans-Turner, Policy Lead at Rainforest Action Network.
In total, banks have financed fossil fuels to the tune of $7.9 trillion (€6.9tn) since the Paris Agreement was signed in 2016.
Last year, they lent or underwrote $429 billion (€371bn) for companies actively expanding fossil fuel extraction.
American banks tend to play a leading role in syndicating the loans and bonds for global fossil fuel companies, the researchers explain. They committed $289 billion (€250bn) in fossil fuel financing in 2024, one-third of the total.
JPMorgan Chase supplied $53.5 billion (€46bn) of that, making it the world's largest fossil fuel financier. Bank of America, Citigroup, Wells Fargo and Japan's Mizuho Financial also take a place in the top five worldwide.
In Europe, UK bank Barclays was 2024's largest fossil fuel financier again, stumping up $35.4 billion (€30.6bn). Barclays also joins JPMorgan Chase, Bank of America and Citigroup among the top four banks with the largest absolute increase in fossil fuel financing last year.
Spain's Santander, France's BNP Paribas, Germany's Deutsche Bank, and the UK's HSBC each contributed between $14 and $17.3 billion (around €12 and €15bn) to the industry.
'This year, banks have shown their true colours - many have walked away from climate commitments and doubled down on financing fossil fuel expansion, even as global temperatures break records,' says co-author Lucie Pinson, Director and Founder at Reclaim Finance.
'A few European banks may have inched forward, but for most, the lure of dirty money has proven too strong.'
France's La Banque Postale stands out as having the strongest fossil fuel exclusion policy of any European bank. It financed no oil, gas, or coal producers in 2024 - though it still provided $36.9 million (€32mn) in financing to three companies with fossil fuel business activities in refining, fossil power generation, or fossil fuel logistics, the report found.
'Every cruel dollar that still goes to fossil fuels is a death sentence to our climate-vulnerable peoples,' says Gerry Arances, co-author and Executive Director at Center for Energy, Ecology & Development (CEED), describing the impact of recent heatwaves across Southeast Asia.
2021 was a high point for 'climate action' from banks. At the UN climate summit in Glasgow, COP26, hundreds of financial institutions joined the Glasgow Financial Alliance for Net-Zero (GFANZ) to reach net zero by 2050.
It followed the formation of the Net Zero Banking Alliance (NZBA) earlier that year, a smaller group of banks which also had the 2050 goal in sight.
But the terms were voluntary, and geopolitical turbulence in the years since has seen banks lose their focus.
Six of the biggest banks in North America pulled out of the NZBA late last year following US President Trump's election.
'Only rapid and robust binding government regulation and oversight can make banks change course,' says Fajans-Turner. 'Without binding regulation, banking on climate chaos will remain banks' dominant investment strategy, tanking our economy and our planet.'
Climate change has tripled the frequency of atmospheric wave events linked to extreme summer weather in the last 75 years, a new study has found. It may explain why long-range computer forecasts keep underestimating the surge in killer heatwaves, droughts and floods.
In the 1950s, Earth averaged about one extreme weather-inducing planetary wave event a summer, but now it is getting about three per summer, according to the study in Monday's Proceedings of the National Academy of Sciences (PNAS) journal.
Planetary waves are connected to 2021's deadly and unprecedented Pacific Northwest heat wave, the 2010 Russian heatwave and Pakistan flooding and the 2003 killer European heatwave, the study said.
'If you're trying to visualise the planetary waves in the northern hemisphere, the easiest way to visualise them is on the weather map to look at the waviness in the jet stream as depicted on the weather map,' said study co-author Michael Mann, a University of Pennsylvania climate scientist.
Planetary waves flow across Earth all the time, but sometimes they get amplified, becoming stronger, and the jet stream gets wavier with bigger hills and valleys, Mann said. It's called quasi-resonant amplification or QRA.
This essentially means the wave gets stuck for weeks on end, locked in place. As a result, some places get seemingly endless rain while others endure oppressive heat with no relief.
'A classic pattern would be like a high pressure out west (in the United States) and a low pressure back East and in summer 2018, that's exactly what we had,' Mann said. 'We had that configuration locked in place for like a month. So they (in the West) got the heat, the drought and the wildfires. We (in the East) got the excessive rainfall.'
'It's deep and it's persistent,' Mann said. 'You accumulate the rain for days on end or the ground is getting baked for days on end.'
The study finds this is happening more often because of human-caused climate change, mostly from the burning of fossil fuels, specifically because the Arctic warms three to four times faster than the rest of the world.
That means the temperature difference between the tropics and the Arctic is now much smaller than it used to be and that weakens the jet streams and the waves, making them more likely to get locked in place, Mann said.
'This study shines a light on yet another way human activities are disrupting the climate system that will come back to bite us all with more unprecedented and destructive summer weather events,' said Jennifer Francis, a climate scientist at the Woodwell Climate Research Center who wasn't involved in the research.
'Wave resonance does appear to be one reason for worsening summer extremes. On top of general warming and increased evaporation, it piles on an intermittent fluctuation in the jet stream that keeps weather systems from moving eastward as they normally would, making persistent heat, drought, and heavy rains more likely,' Francis said.
This is different than Francis' research on the jet stream and the polar vortex that induces winter extremes, said Mann.
There's also a natural connection. After an El Nino, a natural warming of the central Pacific that alters weather patterns worldwide, the next summer tends to be prone to more of these amplified QRA waves that become locked in place, Mann said.
And since the summer of 2024 featured an El Nino, this summer will likely be more prone to this type of stuck jet stream, according to Mann.
While scientists have long predicted that as the world warms there will be more extremes, the increase has been much higher than what was expected, especially by computer model simulations, Mann and Francis said.
That's because the models 'are not capturing this one vital mechanism,' Mann said.
Unless society stops pumping more greenhouse gases in the air, 'we can expect multiple factors to worsen summer extremes,' Francis said. 'Heatwaves will last longer, grow larger and get hotter. Worsening droughts will destroy more agriculture.'