Banks have pledged to go green, but last year they poured billions of dollars into expanding the capacity of fossil fuel production despite the accelerating climate crisis.
Banks provided $673 billion to finance the fossil fuel industry last year, even as oil and gas companies made $4 trillion in profits, according to the annual Banking on Climate Chaos report, authored by a group of nonprofits including The Rainforest Action Network and the Sierra Club.
While Canadian banks are providing a rising share of the money, US lenders still dominate the market and accounted for 28% of all fossil fuel financing in 2022, said the report.
At the top of that list is JPMorgan Chase, the largest funder of fossil fuels cumulatively since the Paris Agreement on climate change was signed in 2016, according to the report. Citi, Wells Fargo, and Bank of America are also among the top five fossil financiers since 2016, the report found.
"Major US banks stalled on their net-zero plans and failed to adopt stronger and more robust financing restrictions for companies pushing unsustainable fossil fuel expansion," said Adele Shraiman, senior campaign representative for the Sierra Club's Fossil-Free Finance Campaign, in a statement.
Oil and gas companies have seen skyrocketing growth as the energy crisis triggered by Russia's war in Ukraine sent prices soaring, challenging people's quality of life and financial stability.
The global oil and gas industry's profits jumped to $4 trillion in 2022, up from an average of $1.5 trillion in recent years, said International Energy Agency chief Fatih Birol in February.
High prices have swelled profits for energy companies, leaving them flush with cash. And their shareholders are certainly feeling that windfall thanks to huge stock buyback programs.
The record profits come after the world's 60 largest private banks provided $5.5 trillion in finance for fossil fuels over the past seven years, according to the report.
JPMorgan Chase, Citi, Wells Fargo and Bank of America are all members of the UN's Net-Zero Banking Alliance, a group of banks committed to achieving carbon neutrality in their operations by 2050.
"By turning their backs on their climate pledges and doubling down on their support for the fossil fuel industry, Wall Street banks are increasing the likelihood of systemic risks to the economy, including a coastal property values collapse, a carbon bubble crash, and insurance market turmoil," said Sen. Sheldon Whitehouse, chairman of the Senate Budget Committee, in a statement.
A spokesperson from the Net Zero Banking Alliance previously told CNN that comprehensive transitional plans "will require years to plan and execute."
An immediate divestment from existing fossil fuel positions could lead to "extreme market shocks" that could "profoundly impact the world's most vulnerable people," the spokesperson added.
"We provide financing across the energy sector: supporting energy security, helping clients accelerate their low carbon transition and increasing clean energy financing with a target of $1 trillion for green initiatives by 2030," Charlotte Powell, head of sustainability communications at JPMorgan told CNN.
The Banking on Climate Chaos report, which has been published for 14 years, examines the fossil fuel funding of the 60 largest banks in the world. Its authors also include BankTrack, Indigenous Environmental Network, Oil Change International, Reclaim Finance, and Urgewald.
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