Financing of new fossil fuel sites surges in 2025
Global banks have ramped up funding for new fossil fuel sites last year, with US banks in particular doubling down while European banks scaled back on fossil fuel finance, new research shows
The world’s largest banks continue to expand financing of the fossil fuel industry, with more than $906bn committed to fossil fuel finance in 2025 alone, according to the latest Banking on Climate Chaos Report released today.
Now in its 17th year, the annual report produced by a consortium of NGOs including Sierra Club, Reclaim Finance and others acts as a key indicator for the direction of travel on fossil fuel finance; it is frequently cited by asset owners engaging with banks on transition planning.
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But the latest figures show that banks continue to fund the expansion of fossil fuels, with new finance to the industry increasing by 8% year on year.
Against the backdrop of a global energy crisis, funding for key fossil fuel sectors increased significantly, with even coal reporting an increase in new funding.
The three largest individual recipients of bank financing globally were all midstream oil and gas companies last year, with LNG / methane being the fastest growing segment, the report shows. Venture Global, the single largest fossil fuel borrower, received some $33bn in new funding alone on the back of rising concerns about energy security. Meanwhile, only 5 of the top 65 banks have LNG export terminal exclusion policies, the report states.
Despite pledges to phase out coal, financing for coal mining surged 77% in 2025, to now $84bn; funding for coal power plants rose by 40% and now stands at just over $80bn.
Doubling down on oil production, banks expanded upstream financing from $192bn to $217bn and midstream expansion financing from $139bn to $255bn.
Since the signing of the Paris Agreement, banks have provided $8.7tn in financing to the oil, coal and gas sectors.
However, the report also highlights regional divergence: while US banks have expanded their activities, with JPMorgan Chase and Bank of America ranking as the world’s biggest financiers alongside Japanese MUFG, European banks have changed their stance.
US banks now account for 32% of all fossil fuel financing, acting as the single largest regional source of fossil fuel finance. They are closely followed by Canadian lenders. The five big Canadian banks—Royal Bank of Canada, Scotiabank, Toronto-Dominion Bank, CIBC and BMO—increased their fossil fuel financing by over 27% in 2025, up to nearly $70bn. All five banks had announced their departure from the Net Zero Banking Alliance in January 2025.
Meanwhile, BNP Paribas reduced fossil fuel deals by 28%; UBS by 36%; and La Caixa by 34%. This is despite the fact that UBS departed from the Net Zero Banking Alliance last year.
BNP in particular has delivered a significant turnaround. Only four years ago, the bank faced legal threats over its role in financing fossil fuels; it has since ceased participating in conventional bond issuances for the oil and gas sector and pledged to direct 90% of its energy production financing toward low-carbon sources by 2030.
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