(WO) – Energy and natural resources (ENR) executives remain divided on the pace of the energy transition and the timing of peak oil demand, as policy uncertainty, cost pressures and shifting market dynamics reshape investment strategies, according to Bain & Company’s 2026 industry survey.
The survey, which gathered responses from more than 800 executives across oil and gas, utilities, chemicals, mining and agribusiness, highlights a growing divergence in how companies are allocating capital between traditional hydrocarbons and transition-oriented technologies.
Despite ongoing decarbonization efforts, most executives still expect global oil demand to rise for at least the next decade. However, views on peak demand vary significantly by region. About half of European oil and gas leaders anticipate demand peaking before 2035, while 41% of North American respondents expect peak oil to occur after 2050, underscoring the influence of regional policy, resource base and energy security considerations.
Investment strategies are increasingly shaped by these regional dynamics. Companies that have already committed significant capital to transition technologies remain largely on course, while others are scaling back. More than half of European firms allocate over 20% of capital to transition-related investments, compared to roughly a quarter of companies in North America and other regions.
Bain identified four key trends influencing the sector’s outlook. First, geopolitical and policy uncertainty is reshaping investment flows, with companies favoring domestic opportunities where regulatory visibility is higher. North America remains a leading investment destination, but its attractiveness has declined, with executives citing policy clarity as a critical factor for scaling capital deployment.
Second, portfolio restructuring is expected to accelerate. Two-thirds of respondents anticipate increased divestments, consolidation and asset rationalization over the next two years, particularly in the chemicals and mining sectors. Ongoing market volatility, rising costs and competitive pressures continue to weigh on margins and long-term planning.
Third, while artificial intelligence is gaining traction across the industry, most companies have yet to realize meaningful returns. Roughly two-thirds of executives report ongoing pilots or early-stage deployments, but only a quarter have scaled AI applications to deliver measurable impact. Early use cases are concentrated in operations, maintenance, customer service and research functions.
Finally, rising power demand linked to AI and data centers is influencing utility investment strategies. Rather than pursuing speculative technologies, utilities are prioritizing proven, near-term solutions, including energy storage, natural gas generation, transmission upgrades and life extensions for existing assets.
Looking ahead, executives are placing greater emphasis on co-investment with private-sector partners, particularly technology firms, rather than relying on government support. The shift reflects a broader focus on capital discipline and investment strategies grounded in economic returns.
As geopolitical tensions and policy uncertainty persist, the survey suggests that ENR companies will continue to balance transition ambitions with the need to ensure reliable, affordable energy supply—reinforcing the central role of hydrocarbons in the near- to medium-term outlook.
