The BHP Group Ltd (ASX: BHP) share price is climbing, up 2% in morning trade.

BHP's share price gain comes as the wider S&P/ASX 200 Index (ASX: XJO) is also climbing strongly, up more than 1%.

But the company may be getting an added lift after news broke that it's reportedly considering pulling the plug on its oil and gas ventures.

Amongst the largest companies on the ASX 200, the mining and resource giant has been pumping oil and gas from the ground for more than 50 years.

But with rising environmental, social and corporate governance (ESG) concerns among global investors and the long-term outlook for oil demand cloudy, BHP may be ready to turn off the crude taps…for a price.

Why BHP may sell its oil and gas assets

These days, the profits from BHP's petroleum segment only account for about 6% of its total profits, according to RBC Capital Markets' forecast. Iron ore makes up the lion's share of profits, some 72%. Copper makes up most of the rest at 21%, with coal providing a slender 1% of profits.

Quoting people familiar with the matter who asked not to be identified, Bloomberg reports, "The world's biggest miner is reviewing its petroleum business and considering options including a trade sale… BHP wants to exit while it can still get a good price for the assets, aiming to repeat a 2018 sale of its shale business to BP Plc for $10.4 billion".

The petroleum segement is expected to earn more than US$2 billion (AU$2.7 billion) this year.

According to RBC Capital Markets analyst Tyler Broda (quoted by Bloomberg):

BHP is an outlier in the mining sector for its petroleum business and this is often cited in our investors discussions as a point of detraction. With rising ESG pressures facing the industry, but also as this business potentially enters into a re-investment phase, we can see why management might be contemplating an exit.

Broda values BHP's petroleum business at some US$14.3 billion.

Peak oil may be here sooner than expected

BHP may be getting on the front foot with its reported petroleum asset sale plans.

A new reported from BloombergNEF, its energy data and analysis firm, states that, "Demand for gasoline and diesel to fuel cars and trucks will peak in 2027 – four years earlier than expected – as more fuel-efficient autos and increasing adoption of electric vehicles curb global consumption."

According to the report:

Policy makers are driving the automotive market toward low-carbon options and improved fuel efficiency. Automakers and large fleet operators are also, in turn, aiming for long-term decarbonization. Fuel producers with exposure to markets like the US or Europe are poised to see sales of diesel and gasoline decline significantly from current levels over the next decade.

If oil demand is close to peaking, then BHP's share price may benefit longer term from the company's reported plans to get out of the oil and gas game.

BHP share price snap shot

Over the past 12 months BHP's share price is up 29%, outpacing the 19% gains posted by the ASX 200 over that same time.

Year-to-date the BHP share price has gained 18%.

BHP pays a 4.1% dividend yield, fully franked.