Precious Anga
Lagos — The world’s 65 largest banks increased financing for fossil fuel companies to $906 billion in 2025, marking the second consecutive year of growth in funding for oil, gas and coal projects despite global commitments to reduce carbon emissions.
The latest findings were contained in the 17th edition of the annual Banking on Climate Chaos report, coordinated by the Rainforest Action Network and a coalition of climate campaign groups.
According to the report, fossil fuel financing by major banks rose by about eight per cent from 2024 levels, reflecting a growing shift away from aggressive net-zero lending restrictions that had gained momentum earlier in the decade.
The report showed that since the adoption of the Paris Climate Agreement in 2015, the world’s largest banks have collectively provided approximately $8.7 trillion in financing to fossil fuel companies across the oil, natural gas and coal sectors.
The increase in funding comes as global energy security concerns, rising energy demand and changing political priorities continue to influence investment decisions across major financial institutions.
Data from the report identified U.S. banking giant JPMorgan Chase as the world’s largest fossil fuel financier in 2025, providing $58.2 billion in financing to the sector. The figure represents a 12.5 per cent increase compared with the previous year.
Bank of America ranked second with $47 billion in fossil fuel financing, while Japan’s Mitsubishi UFJ Financial Group (MUFG) also committed $47 billion, recording one of the largest year-on-year increases among leading lenders.
Other banks featured among the top fossil fuel financiers included Japan’s Mizuho Financial Group and SMBC Group, as well as Citigroup, Wells Fargo, Morgan Stanley, Royal Bank of Canada and Barclays.
The report noted that U.S. banks continued to strengthen their position as the largest source of global fossil fuel financing. American lenders accounted for 32 per cent of total fossil fuel funding in 2025, compared with 28 per cent in 2021.
Analysts attribute the trend partly to a political and regulatory environment that has become less supportive of strict environmental, social and governance (ESG) lending restrictions, particularly in the United States.
While several European financial institutions reduced exposure to fossil fuel financing, the report found that some banks moved in the opposite direction.
France’s BNP Paribas reduced fossil fuel financing by 28 per cent, while UBS cut funding by 36 per cent and Spain’s La Caixa reduced exposure by 34 per cent. However, Standard Chartered increased fossil fuel financing by 28 per cent, Deutsche Bank raised funding by 20 per cent and HSBC expanded financing by 16 per cent.
The findings underscore the continuing importance of fossil fuels in the global energy mix despite increasing investment in renewable energy and growing pressure from environmental groups.
Industry observers note that rising energy demand, concerns over supply security and the need to finance new oil and gas developments have continued to attract substantial capital from global financial institutions.
Commenting on the report, Lucie Pinson, founder of Reclaim Finance and one of the report’s co-authors, said the scale of financing flowing into fossil fuel projects demonstrates that major banks remain closely linked to the sector despite public climate commitments.
The latest figures suggest that global financial institutions continue to view oil and gas investments as commercially viable opportunities, even as governments and corporations pursue long-term decarbonisation goals.
For the energy industry, the report highlights the critical role that banks continue to play in supporting upstream oil and gas development, infrastructure expansion and energy supply projects across both developed and emerging markets.
The increase in fossil fuel financing also comes at a time when global energy markets remain focused on supply security, geopolitical tensions and investment requirements needed to meet growing energy demand over the coming decades.
