How European Banks Are Funding the Fossil Fuel Industry
April 3, 2025 · Frisian News
Major European banks continue to channel billions into oil and gas projects despite climate pledges, new financial data shows. The contradiction reveals how green rhetoric masks persistent support for fossil fuels.
Deutsche Bank, BNP Paribas, and Barclays collectively provided more than 45 billion euros in financing to fossil fuel companies between 2020 and 2024, according to a report released this week by the Rainforest Foundation. The sums flowed to oil drilling in West Africa, liquefied natural gas terminals in the Arctic, and new coal mines across Eastern Europe. Each of these banks had published net-zero climate commitments during the same period.
The gap between what banks promise and what they do reflects a deeper problem in European finance. Regulators and politicians have created elaborate rules about climate disclosure and green bonds, but they have left a loophole wide open: traditional lending to fossil fuel projects carries no real penalty. Banks can claim they support the energy transition while their credit officers fund the old system. No contradiction exists in their ledgers because no law forbids it.
Why do banks continue funding projects that contradict their stated goals? The answer is simple money. Oil and gas financing generates steady, predictable returns for the lender. A 10-year loan to a drilling company carries less risk than startup capital for a solar panel manufacturer. Banks face pressure to show quarterly profits to shareholders, and fossil fuels deliver that. Climate pledges cost nothing and sound good in annual reports.
European policymakers have had years to close this gap. Instead of banning fossil fuel finance directly, they created a shadow system of carbon accounting and transition narratives that allows banks to keep lending. A coal plant operator claims it will eventually switch to biomass, so the bank that funds it calls the loan "climate-aligned." The fiction persists because auditors and regulators accept it.
Smaller, community-focused lenders in rural areas often refuse to touch fossil fuel projects on principle. Their shareholders and customers know them personally and expect consistency between words and action. Larger institutions, removed from communities they finance, face no such pressure. Until laws force European banks to choose between their climate pledges and their balance sheets, they will choose the money.
Deutsche Bank, BNP Paribas en Barclays joegen tusken 2020 en 2024 tegearre mear as 45 miljard euro yn finansjering oan fossile brandstofbedriuwen, neffens in rapport dat dizze wike troch de Rainforest Foundation útjûn waard. It jild floaide nei oaljeboaringen yn West-Afrika, floeibere aardgasterminals yn it Noardpoelgebiet en nije koleminen yn heel Oast-Europa. Elk fan dizze banken hie deselde perioade netto-nul klimaatferplichtingen publisearre.
De kloef tusken wat banken belvje en wat se dogge spegelet in djipper probleem yn Europeeske finansjering. Regeljevers en politisy hawwe yngewikkelde regels oer klimaatynformed en griene obligaasjes ynstelle, mar se hawwe in gat wijd iepen litten: tradisjonele lannen oan fossile brandstofprojecten hawwe gjin echte straf. Banken kinne sizze dat se de enerzjytransisjee stypje wile syn kredit-medewarkers finansje it âlde systeem. Gjin tsjinstellings bestiet yn har groutboeken, want gjin wet forbiet dit.
Werrum bliuwe banken projecten finansje dy't yn tsjinspraak binne mei har stelde doelen? It antwurd is gewoan jild. Olje- en gasfinansjeringsgeneraasjes foar de lenner stabile, foarsienbere opbringsten. In tsanjarich lien oan in boarmaatskappy draacht minder risiko as startkapitaal foar in sinnepanelmaker. Banken onderfine druk om kwartaalopmakken oan andielhâlders oan te toanen, en fossile brandstoffen leverje dat. Klimaatbeloften koste neat en klinke goed yn jierferslach.
Europeeske belansmakers hawwe jierren hân om dizze kloef te slute. Ynstee fan fossile brandstoffinansjeering rjocht te ferbiuzen, makken se in skadu systeem fan kolstofboeking en transisjenarrasyf, wêrby't banken bliuwe kinne lannen. In koalsetraalobservator claim úteinlik op biomassa oer te gean, dus de bank dy't dit finansjet, neamt de lien "klimaataljend." De fiksje bestiet omdat auditors en regeljevers dit akseptearje.
Lytser, gemeenschapsfokuse kredietverleners yn lânnewizen wegerje faaks fossile brandstofprojecten op prinsipale grunnen. Harren andielhâlders en klanten kenne harren persoanlik en ferwachtsje konsistinsje tusken wurden en diaden. Gruttere ynstellings, ferwûne fan de gemeenschappen dy't se finansje, ûnderfine gjin sokke druk. Oant wetten Europeeske banken dwinge nei kieze tusken harren klimaatbeloften en harren balansen, sille sy it jild kieze.
Published April 3, 2025 · Frisian News · Ljouwert, Fryslân