Investors are returning to oil and gas majors as the ESG hype fades in the wake of the U.S. energy policy shift. Low valuations have attracted bargain hunters, defying the market’s anti-fossil fuel sentiment. ExxonMobil’s share price plummeted, but rising energy prices have bolstered confidence in fossil fuels.

European oil giants like Shell and BP are scaling back their renewable energy investments, refocusing on oil and gas production to meet growing energy demands. The renewables sector’s high costs and low profitability have led to a strategic pivot back to traditional energy sources.

Equinor of Norway acknowledges the uncertain pace of the energy transition, opting to maintain high levels of oil and gas production until at least 2035. The return to core business activities and exploration efforts has boosted market valuations for Exxon, Chevron, and BP, making Big Oil an attractive investment opportunity.

Investors see Big Oil as a bargain compared to other sectors and Big Tech, with potential for increased valuations leading to looser financial discipline in the future. Despite the rebound, prudent investment policies are in place due to oil market uncertainties and expectations of oversupply in the near term.

Read more at Yahoo Finance: Wall Street Rediscovers Oil and Gas