Digital transformation is reshaping the oil and gas industry, offering powerful tools to enhance sustainability while maintaining operational efficiency. This review examines how digital technologies such as artificial intelligence (AI), the Internet of Things (IoT), and data analytics contribute to reducing environmental impact, improving resource management, and driving innovation in oil and gas operations. The sector faces increasing pressure to transition towards more sustainable practices due to regulatory demands, stakeholder expectations, and the global shift towards a low-carbon economy. In response, companies are adopting digital solutions to optimize energy use, minimize emissions, and enhance safety and transparency. Key technologies like AI and machine learning are instrumental in predictive maintenance, helping companies to foresee equipment failures and reduce operational downtime. IoT devices enable real-time monitoring of energy consumption and emissions, allowing companies to adjust operations to meet environmental standards more efficiently. Data analytics further enhances decision-making by providing insights into energy use, waste reduction, and resource allocation. These digital tools support a shift toward more circular economy models, where waste is minimized, and energy efficiency is maximized. Moreover, blockchain technology is being employed to ensure transparency and traceability in supply chains, enabling more sustainable procurement and resource management. Digital twins—virtual replicas of physical assets—are used to simulate processes, reduce risks, and improve performance while reducing environmental impacts. This integration of digital technologies not only helps companies meet regulatory compliance but also opens new avenues for innovation and competitiveness in a sustainable market. As oil and gas companies navigate the complexities of digital transformation, it is evident that these technologies are key to achieving long-term sustainability goals. This study highlights how digital transformation is crucial for creating a more sustainable future in the oil and gas industry by enhancing operational efficiency, reducing emissions, and fostering innovation.