Global banks pour $906bn into fossil fuels despite net-zero pledges

The world’s largest banks increased financing for fossil fuel companies to a staggering $906 billion in 2025, exposing a widening gap between climate commitments and investment decisions as concerns over energy security and geopolitical instability continue to reshape global capital flows.

The latest Banking on Climate Chaos 2026 report revealed that the world’s 65 biggest banks raised fossil fuel financing by nearly eight percent from the previous year, marking a second consecutive annual increase despite years of pledges to align lending portfolios with global net-zero ambitions.

The latest findings were revealed in the 17th edition of the annual Banking on Climate Chaos report, coordinated by the Rainforest Action Network and a coalition of climate advocacy organisations.

The report found that banks provided $906 billion in financing to oil, gas and coal companies in 2025 alone, while cumulative financing to the fossil fuel sector since the Paris Climate Agreement reached an estimated $8.7 trillion. Fossil fuel expansion financing also surged by more than 27 percent year-on-year to $508 billion.

“Twenty-six of the world’s top 65 banks reduced their fossil fuel financing in 2025, yet still the world’s largest banks on balance committed $906 billion to companies conducting business in fossil fuels,” the report stated. It added that the increase was “directly incompatible with achieving carbon neutrality by 2050 and limiting global warming to 1.5°C.”

The report argued that financing for fossil fuel expansion is particularly significant because it locks in decades of future emissions and increases exposure to future energy price shocks.

“The top 65 banks committed $508 billion to companies expanding fossil fuel developments in 2025, a $108 billion increase since 2024,” the report noted. “Every dollar of new oil, gas, or coal capacity built now extends a system whose recent shocks, from Ukraine in 2022 to Iran in 2026, have already cost households and economies dearly.”

JPMorgan Chase retained its position as the world’s largest fossil fuel financier, providing $58.2 billion in funding during the year, followed by Bank of America with $47.3 billion and Japan’s Mitsubishi UFJ Financial Group with $47 billion.

One of the report’s most striking findings was the growing concentration of fossil fuel financing among a small group of lenders. According to the study, just 12 banks accounted for nearly 39 percent of all global fossil fuel financing in 2025.

“The fact that overall financing rose despite more than a third of major banks pulling back shows how concentrated the problem has become,” the report said. “Just twelve banks, the ‘Dirty Dozen’, control nearly 39% of all bank fossil deals in 2025.”

The report further highlighted that six major financial centres, the United States, Canada, Japan, China, the United Kingdom and the European Union, accounted for 87 percent of global fossil fuel financing, giving regulators in those jurisdictions significant influence over the future direction of energy investment.

While several European banks reduced fossil fuel exposure, US lenders strengthened their dominance. American banks accounted for approximately 32 percent of global fossil fuel financing in 2025, the highest share of any region.

The report linked the renewed growth in fossil fuel financing to heightened energy security concerns following major geopolitical disruptions, including the Russia-Ukraine conflict and the recent Middle East crisis involving Iran.

According to the report, these events have exposed vulnerabilities within global energy markets and influenced lending decisions by major financial institutions.

“Affordable energy, environmental justice, respect for human rights, and a livable climate are all critical pillars of society,” the report stated, warning that many banks continue to channel capital into “the fragile fossil fuel energy system.”

The report concluded that banks remain central to determining the pace of the global energy transition and called for an immediate end to financing for fossil fuel expansion projects.

“Banks and policymakers are not neutral in this age of fossil energy instability,” the report stated. “The path forward is clear.”