Global Banks Clash Again Over Climate

One of the greatest ironies in modern finance is the gap between what bankers preach about ESG standards and what they actually fund—especially among the world’s largest financial institutions. The latest report by international environmental groups reveals an alarming reversal: in 2024, the 65 largest global banks funneled $869 billion into oil, gas, and coal projects—a more than 20% increase compared to the previous year. In other words, two-thirds of these banks increased fossil fuel financing by around $162 billion from 2023 levels. This surge comes after years of decline, spurred by climate pledges, marking a clear break in the trend of reduced dirty energy investment.

Leading this fossil fuel resurgence are major U.S. banks. JPMorgan Chase has retained its notorious title as the world’s top fossil fuel financier—lending roughly $53.5 billion in 2024 alone. It’s followed closely by Bank of America (about $46 billion) and Citigroup (around $44.7 billion), each upping their fossil investments by over $10 billion from the previous year. These numbers paint a sobering picture: global finance remains deeply entrenched in fossil energy, despite public declarations of support for decarbonization goals.

Sustainability Promises vs. Profit Reality

This shift comes as companies and investors increasingly emphasize ESG standards (environmental, social, and governance) and transition plans toward low-carbon portfolios. Yet, bank behavior tells a different story. According to the Rainforest Action Network (RAN), the group behind the report, banks are increasing “dirty” energy financing while quietly backpedaling from the bold climate commitments they once made at global summits. Recall that at COP26 in Glasgow in 2021, many financial giants pledged net-zero emissions and cuts in fossil fuel support. Just four years later, we’re seeing those promises unravel.

A few striking examples: six of the largest U.S. banks—including JPMorgan, Citi, and Bank of America—collectively exited the Net-Zero Banking Alliance, citing regulatory pressures. Meanwhile, some of these same institutions have relaxed internal coal financing policies. For example, Bank of America quietly revised its policy in late 2023 to allow investments in new coal power plants “under enhanced scrutiny”—a rollback from previously excluding such projects entirely. These actions send a clear message: profit and geopolitical interests still outweigh green agendas, regardless of ESG reports or branding.

Energy Insecurity as Justification

Why this spike in fossil fuel financing now? A big part of the answer lies in global energy market upheavals. The war in Ukraine and geopolitical tensions disrupted energy supplies—especially in Europe—causing record gas and oil prices in 2022 and 2023. Suddenly, energy security overtook climate concerns. Western countries, fearful of shortages, reverted to old habits—from restarting coal plants in Europe to aggressive investments in new liquefied natural gas (LNG) terminals worldwide. Banks saw opportunity. Market analysis shows much of the increased 2023–24 financing went into LNG projects—via loans and bonds for new terminals, gas fields, and transport infrastructure. Banks framed this as support for energy stability amid crises; critics say it’s a convenient excuse to funnel more capital into fossil fuels while prices are high.

It’s important to note: while these investments may temporarily ease price shocks, they pull us further from climate goals in the long run. The International Energy Agency (IEA) has made it clear: staying below 1.5°C of warming requires no new oil and gas projects. Every new pipeline or oilfield locks in decades of emissions, incompatible with the Paris Agreement. Yet, the logic of short-term profit—fueled by supply fears—is currently dominating boardrooms.

The Permian Basin: A Symbol of Financial Contradictions

The biggest rise in fossil financing is seen in the U.S., unsurprising given the dominance of American banks. But one hotspot stands out: the Permian Basin in Texas, the world’s largest shale oil and gas field, is now the epicenter of a new investment boom. In 2023 and early 2024, the region witnessed record M&A activity among oil and gas firms, exceeding $100 billion. Giants like ExxonMobil and Chevron acquired smaller players—Exxon’s $60B acquisition of Pioneer Natural Resources, Chevron’s $53B bid for Hess—consolidating reserves for years to come. These mega-deals were backed by enormous loans and financing deals, eagerly facilitated by Wall Street.

Moreover, banks aren’t just funding large corporate takeovers—they're also pouring money directly into fossil production expansion. According to RAN, one of the top recipients of fresh capital last year was Diamondback Energy, a shale operator based in the Permian. In 2024 alone, Diamondback secured a staggering $20.9 billion in financing to expand drilling and infrastructure in Texas. These sums underscore that banks see continued profit in America’s “oil renaissance”—even as they publicly back green transition goals. The Permian Basin has thus become a symbol of contradiction: once hailed for fracking innovation, it now tests the sincerity of financial climate commitments. So far, the profit calculus is winning.

Critics warn that this double standard is unsustainable. Banks may hope to sidestep reputational damage by juggling green PR with business-as-usual fossil investments. But the reality of climate change will catch up. The year 2024 was the hottest on record, marked by devastating fires, floods, and heatwaves around the world—fueled largely by the burning of fossil fuels that banks continue to finance.

Bosnia and Herzegovina: Fossil-Fueled Status Quo Without a Phaseout Plan

Global developments are echoed, directly or indirectly, in Bosnia and Herzegovina. Although often on the periphery of global trends, BiH remains firmly rooted in a fossil-heavy energy structure. An estimated 78–79% of total primary energy still comes from coal, oil, and gas. The electricity sector is even more dependent: around two-thirds of electricity is generated from coal (Tuzla, Kakanj, Ugljevik, Gacko, etc.), while hydro accounts for the rest—roughly a third, depending on rainfall. Wind and solar farms have only recently begun to emerge and still play a minimal role. In short, BiH has one of the most carbon-intensive energy mixes in Europe—a legacy of outdated strategies and a lack of forward planning.

Yes, there have been recent improvements: several wind farms (Mesihovina, Jelovača, Podveležje) have been built, and solar installations are growing rapidly as tech costs fall. The share of renewables in final energy use is slowly increasing, and BiH has nominally met its modest target (around 40% renewable energy by 2020—largely due to widespread firewood use for heating). But in reality, the country still lacks a clear coal phaseout strategy. While many countries in the region and across Europe have set closure dates (e.g., Poland by 2049, Greece by 2028, North Macedonia aims for the 2030s), BiH has no such timeline—nor a national consensus on the inevitability of coal’s decline. On the contrary, some authorities still aim to prolong existing plants or even plan new ones. In 2022, the Federation government approved the extension of outdated units Tuzla 4 and Kakanj 5 despite Energy Community obligations, prompting legal action against BiH. Meanwhile, Republika Srpska’s authorities still formally plan new coal plants (Ugljevik III, Gacko II), though funding has made these projects unlikely. This clearly signals a lack of political will and strategy for a coal exit.

For BiH, which aspires to EU membership, maintaining the fossil status quo comes with multiple risks. Beyond environmental and health concerns (e.g., Ugljevik has long ranked among Europe’s top sulfur dioxide polluters), economic risks loom. The EU is implementing mechanisms like carbon border taxes (CBAM), which will make electricity and industrial exports with high carbon footprints more expensive. Long-term, investments in renewables, energy efficiency, and transitional gas infrastructure are far more cost-effective than maintaining obsolete coal assets. Yet BiH lags behind—trapped between short-term political and social pressures (jobs in mining, cheap state-generated electricity) and long-term energy transition needs.

Paradoxically, while global banks are being criticized for undermining the climate fight by continuing fossil financing, BiH could soon find those same banks refusing to fund fossil projects domestically. Major international lenders have begun drawing red lines: for example, several European development banks declined to finance the Tuzla 7 coal unit, leading to the project's cancellation in 2023. This suggests the era of easy fossil capital is ending—whether BiH admits it or not.

Conclusion

The rising fossil fuel financing by the world’s largest banks is a stark warning. In an era when climate change is undeniable and the clean energy transition more urgent than ever, the financial industry stands at a crossroads: continue pouring billions into oil, gas, and coal—deepening the crisis—or pivot toward a sustainable future. Sadly, the short-term profit motive seems to be winning over long-term responsibility. This gap between words and actions is most visible in the gleaming towers of Wall Street—and the smoke stacks of Tuzla and Gacko.

For Miloš Stevanović, the bitter truth is that real change will only happen when regulators and society force banks to treat climate risk as seriously as credit risk. Until then, each report like this one from 2024 will stand as testimony to how financial powerhouses of the Global North continue to bankroll climate collapse—while the burden of consequences falls hardest on others, including small, fossil-fuel-reliant countries like BiH. One exception worth noting: Intesa Bank stands out as a rare example of ESG-aligned banking.

References

• Rainforest Action Network & partners, Banking on Climate Chaos – Fossil Fuel Finance Report 2025 (report)

• Earth.Org – Martina Igini: “World’s Largest Banks Pledged $869 bn to Fossil Fuel Companies in 2024.” (June 19, 2025)

• Oliver Milman, The Guardian: “World’s largest banks pledged $869bn to fossil fuel firms in 2024, new report finds.” (June 17, 2025)

• Argus Media: “Banks’ 2023 fossil fuel funding rises to $705bn: Study.” (May 13, 2024)

• Reuters: “M&A deals in Permian basin exceeds $100 billion in 2023 – WoodMac.” (December 12, 2023)

• Bankwatch: “The energy sector in Bosnia and Herzegovina.” (updated 2025)

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