By Arathy Somasekhar and Maha El Dahan

HOUSTON (Reuters) - Policymakers and energy executives need to rethink energy transition plans and stop doubling down on elements of the transition that have failed, the CEO of state oil giant Saudi Aramco said on Monday, stressing the need for investment in fossil fuels to meet global demand.

The comments from the head of the world's largest oil company come as the administration of President Donald Trump pushes to maximize oil and gas production, a dramatic U-turn in U.S. energy policy after former President Joe Biden enacted legislation to accelerate the transition away from fossil fuels in the world's largest economy.

In Europe, policymakers have slowed the rollout of clean energy policies and delayed targets as energy costs soared following Russia's invasion of Ukraine in 2022, shifting their focus to energy security. European oil majors have pulled back from plans to build-out greener technologies because they have proved unprofitable.

"We can all feel the winds of history in our industry's sails again," Aramco CEO Amin Nasser told executives from the world's biggest energy companies at the CERAWeek conference in Houston.

"It is time to stop reinforcing failure," Nasser said, referring to green hydrogen as an example of a fuel that has been the focus of energy transition policies, but which is still too expensive for widespread commercial use.

"In fact, there is more chance of Elvis speaking next than the current plan working," he said.

New energy sources can complement fossil fuels but not replace them, he said. Investment in all sources of energy was needed to meet global energy demand, he added.

"... the current strategy of prematurely switching to immature alternatives has been so self-destructive. New sources cannot even meet the growth in demand."

Deregulation and greater incentives for financial institutions to provide "unbiased financing" were necessary to ensure sufficient investments in energy, he said. Many financial institutions have reduced their investments in fossil fuels in favor of more sustainable industries.

Aramco invested more than $50 billion last year in conventional and renewable energy projects, Nasser said.

The company has a target to invest in up to 12 gigawatts of solar and wind energy by 2030, he added.

In his address to the conference last year, Nasser also called on the industry to "abandon the fantasy of phasing out fossil fuels."