With oil prices blasted by a double blow of oversupply and demand throttled by the coronavirus crisis, some industry giants are eyeing less polluting investments as bets on a less hydrocarbon-heavy future.
The world's top five oil firms -- BP, Chevron, ExxonMobil, Royal Dutch Shell and Total -- reported combined losses of $53 billion for the second quarter in recent days.
BP announced it would cut production by the equivalent of a million barrels of oil per day until 2030 as part of a plan to reach "net zero" greenhouse emissions by mid-century.
"If there was ever a moment to reset, this is it," said Luke Parker of energy consultancy Wood Mackenzie.
"Our view is that BP has taken the prudent course of action."
In recent months, producer countries have been slow to reduce the amount of oil flooding the market even as major consumers like the airline industry saw operations pared back to almost nothing.
In April, oil prices even fell into negative territory for the first time in history as traders scrambled to offload stock.
The impact has accelerated a strategic rethink for some oil companies.
Even before the pandemic struck they could see governments stepping up plans to reach net zero carbon dioxide (CO2) emissions in the fight against climate change.
'Stranded fossil assets'
"If I were an investor in oil and gas, I would be worried that I would be putting my money in an outdated and risky industry," said Arthur van Benthem, an associate professor at Pennsylvania's Wharton Business School.
The fossil firms' results were not only undermined by reduced activity from the pandemic, but also massive write-downs in the value of their most precious assets - their as-yet untapped oil and gas reserves.
"These assets will either be less profitable when they come on line, or not be produced at all at the future prices now expected," said professor David Elmes of Warwick Business School.
By themselves, forecasts for low energy prices to persist into the coming years can't explain the sizes of the write-downs.
Rather, they are "part of a longer trend in which the rapid pace at which renewable energy is becoming competitive is putting traditional energy companies at risk," van Benthem said.
"Large investment companies, insurers, central banks, and others are warning the market about ‘stranded fossil assets'... the renewable energy market seems a much safer bet."
As companies look to cut costs, new approvals for oil and gas projects could plunge by 75 percent this year, Rystad Energy analysts predict, rather than holding steady as previously expected.
The biggest oil companies "have the scale and money to change away from fossil fuels over time and face a stark choice on when to do so," Warwick professor Elmes said.
Alongside BP's cuts -- set to reduce its production by 40 percent of 2019 levels over the coming decade -- the London-based giant said it would multiply investments in renewable energies by 10 times over the same period.
"This coming decade is critical for the world in the fight against climate change, and to drive the necessary change in global energy systems will require action from everyone," chief executive Bernard Looney said.
Nevertheless, rating agency Standard and Poor's recalled that across the industry, "the proportion of public communications about greener strategies or renewable initiatives by these companies has not been matched by the share of non-oil and gas investment planned".
Renewable energy is likely to fall far short of the profit margins achievable with hydrocarbons, the credit analysts said.
"Overall, we expect oil and gas to remain the largest contributor to supermajors' cash generation for many years," they added.