Equinor vs Shell vs ExxonMobil: How oil majors are mapping the energy future differently in 2025

Equinor ASA (NYSE: EQNR), Shell plc (NYSE: SHEL), and ExxonMobil Corporation (NYSE: XOM) are navigating 2025’s complex energy landscape with distinctly different strategies. Each of the three global oil majors has released updated energy outlooks or corporate plans that reflect diverging responses to decarbonisation policy, geopolitical risk, and energy market evolution. While natural gas appears to be a shared strategic pillar, their positioning on renewables, carbon capture, hydrogen, and long-term capital allocation reveals major ideological and operational differences.

This divergence comes as energy markets are strained by high financing costs, supply chain constraints, and a resurgence in fossil fuel use driven by energy security priorities. With scenario planning replacing linear forecasting, institutional investors are increasingly using these differing corporate visions to guide capital allocation and assess long-term risk in the energy sector.

What are Equinor’s four energy transition scenarios?

The Norwegian energy developer Equinor has published Energy Perspectives 2025, featuring four comprehensive scenarios: Walls, Plazas, Silos, and Bridges EP23. These narratives are designed to model how varying combinations of climate policy, trade openness, and energy security concerns will shape global energy systems through 2050.

In the baseline scenario called Walls, fossil fuel demand peaks in the late 2020s, but global emissions fall just 35% by 2050—insufficient to meet the goals of the Paris Agreement. Plazas, a high-growth, trade-driven pathway, sees slower decarbonisation and only a 16% emissions cut. Silos reflects a fragmented, security-focused future with limited global collaboration. The most ambitious, Bridges EP23, assumes aggressive climate policy and rapid renewables deployment—but Equinor now acknowledges this scenario is no longer within reach without an additional 5 Gt of CO₂ removals.

Equinor’s own investment trajectory reflects this recalibration. The Norwegian state-backed energy firm has reduced its near-term renewables capital expenditure from $10 billion to $5 billion over two years. Its offshore wind, CCS, and hydrogen commitments remain active but are being reprioritized in line with project execution risks and capital constraints.

Institutional observers interpret Equinor’s move as a shift toward financial prudence, particularly given Europe’s volatile regulatory environment and persistent cost inflation in clean energy technologies.

Why Shell is pivoting toward LNG and shareholder value

Shell plc has restructured its long-term strategy around its 2025 Energy Security Scenarios, projecting a 25% rise in global primary energy demand by 2050. At the core of its plan is liquefied natural gas, where Shell expects global demand to increase 60% by 2040, particularly in Asia and Europe.

The London-headquartered oil and gas producer is targeting 2% annual growth in upstream gas volumes and a 4–5% annual increase in LNG sales through 2030. Chief executive Wael Sawan has framed Shell’s current strategy around capital discipline and shareholder returns, with plans to reduce annual operating expenditures by $5–7 billion by 2028. Shell has also increased its share buyback programs and de-emphasised direct investments in onshore wind and solar generation.

Shell’s updated capital allocation model prioritises high-margin hydrocarbon assets, particularly LNG, while maintaining lower-risk exposure to transition technologies. EV charging networks, digital energy management, and integrated electricity retail remain on its roadmap, but at a significantly reduced pace.

Investor sentiment has been mixed. While some analysts praise Shell’s renewed focus on profitability and capital efficiency, climate-aligned investment groups have expressed concern about the reduced ambition in decarbonisation. The redirection of funds away from low-carbon growth has triggered increased scrutiny from sustainability funds and ESG benchmark providers.

How ExxonMobil is balancing hydrocarbons with low-carbon bets

ExxonMobil Corporation continues to forecast a prolonged role for oil and natural gas in its Global Outlook to 2050. According to its latest projections, natural gas will represent 25% of global energy demand by mid-century, with liquids demand remaining stable in petrochemicals, aviation, and industrial heat applications.

The Texas-based oil major is simultaneously expanding production in the Permian Basin, Guyana, and offshore Brazil while rolling out a selective low-carbon strategy. ExxonMobil’s Low Carbon Solutions division is spearheading investments in carbon capture and storage, biofuels, and hydrogen. Among its most prominent projects is a large-scale low-carbon hydrogen facility under development in Baytown, Texas. The American oil major has also acquired Biojet AS, a Norwegian biofuels company, to enhance its sustainable aviation fuel capabilities.

Unlike Equinor or Shell, ExxonMobil positions these technologies as supplements to—not replacements for—its core business. It views fossil fuel output as essential for energy security, economic growth, and industrial development in emerging markets. Financially, ExxonMobil’s performance has remained resilient, with strong cash flow from operations supporting dividends and share repurchases.

Analyst consensus reflects confidence in ExxonMobil’s long-cycle discipline. While the firm remains excluded from most ESG indexes, it continues to attract capital from value-oriented funds and energy-focused institutional portfolios due to consistent returns and global scale.

How institutional investors are reacting to diverging energy paths

The diverging energy strategies of Equinor, Shell, and ExxonMobil reflect deeper shifts in institutional risk appetite and regional policy regimes. Equinor, as a state-linked Nordic entity, remains influenced by national climate mandates and policy leadership in offshore wind and carbon pricing. Shell, with exposure to both EU regulation and UK capital markets, must navigate pressure from both activist shareholders and performance-focused institutions. ExxonMobil, by contrast, remains largely shielded from regulatory activism, allowing it to focus on long-term cash flow and scale-based energy delivery.

Exchange-traded fund (ETF) flows in 2025 show measurable divergence. Shell has seen modest outflows from ESG-aligned ETFs due to its softened climate stance. Equinor continues to hold inclusion in climate transition indexes, largely thanks to its scenario transparency and offshore project visibility. ExxonMobil, while excluded from climate-themed funds, has seen strong inflows into traditional energy ETFs following the LNG price rebound and oil market resilience post-2023.

Buy-side analysts expect continued divergence in portfolio inclusion, with Shell and Equinor navigating dual demands for decarbonisation and capital returns, and ExxonMobil remaining a preferred bet for conventional energy allocations.

What to expect next in the energy majors’ strategic roadmaps

Looking ahead, all three oil majors are likely to double down on natural gas as a durable transition asset. Equinor’s models show gas playing a vital balancing role even in scenarios with strong electrification. Shell’s gas production is forecast to grow into the early 2030s, with a focus on integrated LNG value chains. ExxonMobil, meanwhile, is investing in both gas infrastructure and chemical conversion, positioning it for dual-market resilience.

However, the broader success of any long-term strategy may hinge not on fuel types, but on geopolitical stability and global coordination. Equinor’s scenario work warns that fragmented worlds like Silos or Walls could delay decarbonisation and strain capital efficiency. In the absence of a cohesive regulatory framework and international collaboration, even the most technically feasible energy transition could fail to materialise at scale.

Institutional investors and policymakers alike will need to watch how these strategies evolve—especially in response to climate litigation, carbon border taxes, and shifting clean energy trade alliances through 2026 and beyond.