Banks Fund Fossil Fuel Petrochemical Expansion

Major global banks have significantly increased their financing for companies expanding fossil fuel development, with new reports indicating a substantial rise in funding for petrochemical production. In 2025, the world's top 65 banks contributed $508 billion to companies involved in fossil fuel expansion, a 27 percent increase from 2024 and the highest amount recorded since at least 2016, according to an analysis by the Rainforest Action Network (RAN) and other environmental groups. This trend follows the abandonment of climate commitments by several large banks, including the six largest in the U.S., which left the Net-Zero Banking Alliance in 2024 and 2025, leading to the alliance's shutdown. Other institutions like Royal Bank of Canada, Scotiabank, HSBC, NatWest, and Santander have also weakened or eliminated their decarbonization targets.

Beyond supporting oil and gas extraction, these financial institutions are actively bankrolling the fossil fuel industry's pivot towards plastics, fertilizers, and other petrochemical products. A separate report from the Center for International Environmental Law (CIEL) found that between January 2019 and June 2025, major banks provided at least $591 billion in loans and underwriting to the world's top 15 petrochemical companies. Of this total, CIEL could directly attribute $252 billion to petrochemical activities, a figure comparable to New Zealand's annual GDP. This substantial financial backing suggests that large financial institutions are enabling a long-term viability strategy for the fossil fuel industry, one that aims to offset declining demand for oil and gas in energy and transportation with growth in the petrochemical sector.

The shift in focus is evident as oil majors like Exxon Mobil and Shell are increasingly investing in petrochemical operations. The combined reports from RAN and CIEL highlight a critical juncture where financial institutions are not only failing to uphold climate pledges but are actively facilitating the fossil fuel industry's diversification into petrochemicals, potentially exacerbating the climate crisis by enabling continued fossil fuel infrastructure development.