In a large saucepan, combine oil and pancetta and cook over low heat until crisp and golden brown, about 4 to 6 minutes. Drain pancetta on a paper towel and reserve.
In the same pan, cook onions over medium heat until golden brown, about 6 to 8 minutes. Tilt pan to remove excess fat; add beans, bay leaf, and 2 1/2 cups of water. Bring to a boil, reduce heat, and simmer until beans are tender, about 50 to 60 minutes. Add pancetta and season to taste with salt and freshly ground pepper. Serve warm or at room temperature.