As the world grapples with the Covid-19 pandemic, climate change may not be at the top of peoples’ minds. But the crisis hasn’t gone away.
And our climate crisis will continue to escalate as long as people keep investing in fossil fuels. It is as simple as that.
For decades scientists have been warning that climate change is getting worse and that we have to start disinvesting out of fossil fuels.
Year after year, the scientists came together at UN conferences and urged the world to act. Finally, in 2014, at the landmark climate conference in Paris, many nations agreed to prevent runaway climate change.
All the countries who ratified the agreement had an obligation under a legal framework to limit global warming to 2 degrees Celcius above pre-industrial levels, whilst pursuing a tougher target of 1.5°C. Beyond 2°C, climate change impacts are predicted as being catastrophic.
Logic – if there is such a thing as logic – when it comes to climate change, would dictate that since the adoption of the Paris Agreement, banks would start disinvesting heavily from oil, gas, and coal. But that has not happened. In fact, leading banks have continued to pour money into fossils fuels.
You would have thought that millions of dollars would have been reckless. But it is worse than that. Funding it to the tune of billions would have been extremely irresponsible, but it is worse than that.
A new report released today by leading environmental NGO’s, including Oil Change International, Reclaim Finance, and Sierra Club, and endorsed by over 250 organizations, reveals that 35 leading global banks have provided a staggering USD $2.7 trillion to fossil fuel companies since the Paris Agreement in 2015.
And despite the groundswell of climate activism that has swept the world, including the pushing for fossil fuel disinvestment, shockingly the report finds that financial support for the fossil fuel industry has increased every year since 2015.
The report finds that fossil fuel financing continues to be dominated by the big U.S. banks: JPMorgan Chase, Wells Fargo, Citi, and Bank of America. Together, these four banks account for nearly a third – some 30% – of all fossil fuel financing.
JPMorgan Chase alone has provided $269 billion – over a quarter of a trillion dollars – in fossil financing during that time. Ironically, JPMorgan Chase, whose economists warned that the climate crisis threatens the survival of humanity last month, is the most aggressive funder in some of the most dangerous and harmful categories over the last four years. This includes leading in fossil fuel expansion, Arctic oil and gas, offshore oil and gas, and fracking.
It is not the only one funding the dirtiest, most harmful fossil fuels. The report outlines that over the past four years, many of the banks have increased their funding to companies with significant Arctic oil and gas reserves. Financing for fracked oil and gas has also increased year on year.
Meanwhile the biggest bankers of tar sands – the Canadian banks, led by TD and RBC, plus JPMorgan Chase and Barclays – all lack policies restricting their financing to this subsector.
The report was picked up by the Guardian, Financial Times and The Hill, amongst others. The Guardian said the report showed that the report’s findings had prompted “warnings they are failing to respond to the climate crisis.”
Lorne Stockman, a Senior Research Analyst with OCI said: “As the human and financial costs of climate change mount up, these major banks are doubling down on the fossil fuels driving the climate crisis.”
Stockman added: “It’s beyond time banks took seriously their responsibility for financing the greatest threat to the global economy. There is no excuse for carrying on with business as usual. It’s time to stop funding fossils, period.”
Dallas Goldtooth, from the Indigenous Environmental Network, also commented, saying: “From the Amazon to the Arctic – JPMorgan Chase, Citi, Bank of America and Wells Fargo’s social licenses to operate are tainted with the debris of climate chaos and Indigenous rights violations.”
“These banks must be held accountable for the destruction of Mother Earth and Indigenous life-ways. The time has long passed for banks to take corrective action – they must divest from fossil fuels now,” said Goldtooth.
- The full report, Banking on Climate Change 2020, can be found here: https://priceofoil.org/fossil-fuel-finance-report-2020.
- A press release from the coalition behind the report, can be found here: https://priceofoil.org/2020/03/18/report-banks-poured-2-7-trillion-into-fossil-fuels-since-paris-agreement/