From Academic Kids

Missing image
Nodding donkey pumping an oil well near Sarnia, Ontario, 2001

Petroleum (from Latin petra – rock and oleum – oil), crude oil, sometimes colloquially called black gold, is a thick, dark brown or greenish flammable liquid, which exists in the upper strata of some areas of the Earth's crust. It consists of a complex mixture of various hydrocarbons, largely of the alkane series, but may vary much in appearance, composition, and purity. It is an important "primary energy" source (IEA Key World Energy Statistics ( Petroleum is also the raw material for many chemical products, including solvents, fertilizers, pesticides, and plastics.



Biogenic theory

Most geologists view crude oil, like coal and natural gas, as the product of compression and heating of ancient vegetation over geological timescales. According to this theory, it is formed from the decayed remains of prehistoric marine animals and terrestrial plants. Over many centuries this organic matter, mixed with mud, is buried under thick sedimentary layers of material. The resulting high levels of heat and pressure cause the remains to metamorphose first into a waxy material known as kerogen, and then into liquid and gaseous hydrocarbons in a process known as Catagenesis. These then migrate through adjacent rock layers until they become trapped underground in porous rocks called reservoirs, forming an oil field, from which the liquid can be extracted by drilling and pumping.

Alternative theories

Thomas Gold was the most widely known Western proponent of the Russian-Ukrainian theory of abiogenic petroleum origin. This theory suggests that large amounts of carbon exist naturally in the planet, some in the form of hydrocarbons. Hydrocarbons are less dense than aqueous pore fluids, and so migrate upward. Deep microbial lifeforms convert them into the various hydrocarbon deposits. Thermodynamic calculations and experimental studies confirm that n-alkanes (common petroleum components) do not spontaneously evolve from methane at pressures typically found in sedimentary basins, and so the theory of an abiotic origin of hydrocarbons suggests deep generation (below 200 km) (see results (


In refining, the component chemicals of petroleum are separated by distillation. Products based on refined crude oil include kerosene, benzene, gasoline, paraffin wax, asphalt, etc. Subtler techniques, such as gas chromatography, HPLC, and GC-MS, can separate some fractions of petroleum into individual compounds.

Strictly speaking, petroleum consists of hydrocarbons: compounds of hydrogen and carbon; and non-hydrocarbon fractions: compounds which might also include nitrogen, sulfur, oxygen, or traces of metals such as vanadium or nickel.

The four lightest alkanes — CH4 (methane), C2H6 (ethane), C3H8 (propane) and C4H10 (butane) — are all gases, boiling at -161.6C, -88.6C, -42C, and -0.5C, respectively (-258.9, -127.5, -43.6, and +31.1 F).

The chains in the C5-7 range are all light, easily vaporized, clear naphthas. They are used as solvents, dry cleaning fluids, and other quick-drying products. The chains from C6H14 through C12H26 are blended together and used for gasoline. Kerosene is made up of chains in the C10 to C15 range, followed by diesel fuel/heating oil (C10 to C20) and heavier fuel oils as the ones used in ship engines. These petroleum compounds are all liquid at room temperature.

Lubricating oils and semi-solid greases (including Vaseline) range from C16 up to C20.

Chains above C20 form solids, starting with paraffin wax, then tar and asphaltic bitumen.

Boiling ranges of petroleum atmospheric pressure distillation fractions in degrees Celsius:


Generally the first stage in the extraction of crude oil is to drill a well into the underground reservoir. Historically, in the USA some oil fields existed where the oil rose naturally to the surface, but most of these fields have long since been depleted, except for certain remote locations in Alaska. Often many wells will be drilled into the same reservoir, to ensure that the extraction rate will be economically viable. Also some wells may be used to pump water, steam or various gas mixtures into the reservoir to raise or maintain the reservoir pressure, and so maintain an economic extraction rate.

If the underground pressure in the oil reservoir is sufficient, then the oil will be forced to the surface under this pressure. Gaseous fuels or natural gas are usually present, which also supplies needed underground pressure. In this situation it is sufficient to place a complex arrangement of valves on the well head to connect the well to a pipeline network for storage and processing. This is called primary oil recovery. Usually, only about 20% of the oil in a reservoir can be extracted this way.

Over the lifetime of the well the pressure will fall, and at some point there will be insufficient underground pressure to force the oil to the surface. If economical, and it often is, the remaining oil in the well is extracted using secondary oil recovery methods. see: Energy balance and Net energy gain. Secondary oil recovery uses various techniques to aid in recovering oil from depleted or low-pressure reservoirs. Sometimes pumps, such as Beam Pumps and Electrical Submersible Pumps (ESPs), are used to bring the oil to the surface. Other secondary recovery techniques increase the reservoir's pressure by Water Injection, natural Gas reinjection and Gas Lift, which injects air, carbon dioxide or some other gas into the reservoir. Together, primary and secondary recovery allow 25 to 35% of the reservoir's oil to be recovered.

Tertiary oil recovery reduces the oil's viscosity to increase oil production. Tertiary recovery is started when secondary oil recovery techniques are no longer enough to sustain production, but only when the oil can still be extracted profitably. This depends on the cost of the extraction method and the current price of crude oil. When prices are high, previously unprofitable wells are brought back into production and when they are low, production is curtailed. Thermally-enhanced oil recovery methods (TEOR) are tertiary recovery techniques that heat the oil and make it easier to extract. Steam injection is the most common form of TEOR, and is often done with a cogeneration plant. In this type of cogeneration plant, a gas turbine is used to generate electricity and the waste heat is used to produce steam, which is then injected into the reservoir. This form of recovery is used extensively to increase oil production in the San Joaquin Valley, which has very heavy oil, yet accounts for 10% of the United State's oil production. In-situ burning is another form of TEOR, but instead of steam, some of the oil is burned to heat the surrounding oil. Occasionally, detergents are also used to decrease oil viscosity. Tertiary recovery allows another 5 to 15% of the reservoir's oil to be recovered.


The first oil wells were drilled in China in the 4th century or earlier. The oil was burned to evaporate brine and produce salt. By the 10th century, extensive bamboo pipelines connected oil wells with salt springs.

The modern history of oil began in 1853, with the discovery of the process of oil distillation. Crude oil was distilled into kerosene by Ignacy Lukasiewicz, a Polish scientist. The first "rock oil" mine was created in Bobrka, near Krosno in southern Poland in the following year and the first refinery (actually a distillery) was built in Ulaszowice, also by Lukasiewicz.

Oil field in California, 1938
Oil field in California, 1938

The American petroleum industry began with Edwin Drake's discovery of oil in 1859, near Titusville, Pennsylvania. The industry grew slowly in the 1800s and did not become a real national concern until the early part of the 20th century; the introduction of the internal combustion engine provided a demand that has largely sustained the industry to this day. Early "local" finds like those in Pennsylvania and Ontario were quickly exhausted, leading to "oil booms" in Texas, Oklahoma, and California. Other countries had sizable oil reserves as a part of their colonial holdings, and started to develop them at an industrial level.

While even in 1955 coal was still the world's foremost fuel, oil began to take over. Following the 1973 energy crisis and the 1979 energy crisis there was significant media coverage of oil supply levels. This brought to light the concern that oil is a limited resource that will eventually run out, at least as an economically viable energy source. At the time, the most common and popular predictions were always quite dire, and when they did not come true, many dismissed all such discussion. The future of petroleum as a fuel remains somewhat controversial. USA Today news (2004) reports that there are 40 years of petroleum left in the ground. Some would argue that because the total amount of petroleum is finite, the dire predictions of the 1970s have merely been postponed. Others argue that technology will continue to allow for the production of cheap hydrocarbons and that the earth has vast sources of unconventional petroleum reserves in the form of tar sands, bitumen fields and oil shale that will allow for petroleum use to continue for an extremely long period in the future.

Today about 90% of vehicular fuel needs are met by oil. Petroleum also makes up 40% of total energy consumption in the United States, but is responsible for only 2% of electricity generation. Petroleum's worth as a portable, dense energy source powering the vast majority of vehicles and as the base of many industrial chemicals makes it one of the world's most important commodities. Access to it was a major factor in several military conflicts, including World War II and the Persian Gulf War. About 80% of the world's readily accessible reserves are located in the Middle East. USA territory has less than 3%.

Environmental effects

The presence of oil has significant social and environmental impacts, from accidents and routine activities such as seismic exploration, drilling, and generation of polluting wastes. Oil extraction is costly and sometimes environmentally damaging, although Dr. John Hunt from Woods Hole pointed out in a 1981 paper that over 70% of the reserves in the world are associated with visible macroseepages, and many oil fields are found due to natural leaks. Offshore exploration and extraction of oil disturbs the surrounding marine environment. Extraction may involve dredging, which stirs up the sea bed, killing the sea plants that marine creatures need to survive. Crude oil and refined fuel spills from tanker ship accidents have damaged fragile ecosystems in Alaska, the Galapagos Islands, Spain, and many other places. Renewable energy source alternatives do exist, although the degree to which they can replace petroleum and the possible environmental damage they may cause is controversial.

Future of oil

Main article: Hubbert Peak

The Hubbert peak theory, also known as peak oil, is a controversial theory concerning the long-term rate of conventional oil and other fossil fuel production and depletion. It assumes that oil reserves are not replenished, and predicts that future world oil production must inevitably reach a peak and then decline as these reserves are exhausted. Much of the controversy is over whether past production or discovery data can be used to predict a future peak. Based on available production data, proponents have previously (and incorrectly) predicted the peak years to be 1989, 1995, or 1995-2000, however these predictions date from before the recession of the early 1980's, and the consequent reduction in global consumption, the effect of which was to delay the date of any peak by several years. A new prediction by Goldman Sachs picks 2007 for oil and some time later for natural gas.


The oil industry classifies "crude" by the location of its origin (e.g., "West Texas Intermediate, WTI" or "Brent") and often by its relative weight (API gravity) or viscosity ("light", "intermediate" or "heavy"); refiners may also refer to it as "sweet", which means it contains relatively little sulfur, or as "sour", which means it contains substantial amounts of sulfur and requires more refining in order to meet current product specifications.

The world reference barrels are:

OPEC attempts to keep the price of the Opec Basket between upper and lower limits, by increasing and decreasing production. This makes the measure important for market analysts. The OPEC Basket, including a mix of light and heavy crudes, is heavier than both Brent and WTI.

See also [1] (


References to the oil price are usually either references to the spot price of either WTI/Light Crude as traded on New York Mercantile Exchange (NYMEX) for delivery in Cushing, Oklahoma; or the price of Brent as traded on the International Petroleum Exchange (IPE) for delivery at Sullom Voe. The price of a barrel of oil is highly dependent on both its grade (which is determined by factors such as its specific gravity or API and its sulpher content) and location. The vast majority of oil will not be traded on an exchange but on a Over-the-counter basis, typically with reference to a marker crude oil grade that is typically quoted via the pricing agency Platts. For example in Europe a particular grade of oil, say Fulmar, might be sold at a price of "Brent plus US$0.25/barrel".or as an intra-company transaction. IPE claim that 65% of traded oil is priced off their Brent benchmarks. Other important benchmarks include Dubai, Tapis, and the OPEC basket. The Energy Information Administration (EIA) uses the Imported Refiner Acquisition Cost, the weighted average cost of all oil imported into the US as their "world oil price".

Missing image
Oil prices from 1860-2005 in 1999 and 2004 dollars. Data Source (Red US$1999): Data Source (Green US$2004):
Missing image
Oil prices, 1994-2005 (not adjusted for inflation).
Missing image
Recent oil prices, 2003-2005

It is often claimed that OPEC sets the oil price and the true cost of a barrel of oil is around $2, which is equivalent to the cost of extraction of a barrel in the Middle East. These estimates of costs ignore the cost of finding and developing oil reserves. Furthermore the important cost as far as price is concerned, is not the price of the cheapest barrel but the cost of producing the marginal barrel. By limiting production OPEC has caused more expensive areas of production such as the North Sea to be developed before the Middle East has been exhausted. OPEC's power is also often overstated. Investing in spare capacity is expensive and the low oil price environment in the late 90s led to cutbacks in investment. This has meant during the oil price rally seen between 2003-2005, OPEC's spare capacity has not been sufficient to stabilise prices.

Oil demand is highly dependent on global macroeconomic conditions, so this is also an important determinant of price. Some economists claim that high oil prices have a large negative impact on the global growth. This means that the relationship between the oil price and global growth is not particularly stable although a high oil price is often thought of as being a late cycle phenomenon.

A recent low point was reached in January 1999, after increased oil production from Iraq coincided with the Asian financial crisis, which reduced demand. The prices then rapidly increased, more than doubling by September 2000, then fell until the end of 2001 before steadily increasing, reaching US $40 to US $50 per barrel by September 2004 (see Oil price increases of 2004). [2] ( In October 2004, light crude futures on the NYMEX for November delivery exceeded US $53 per barrel and for December delivery exceeded US $55 per barrel. Crude oil prices surged to a record high above $59 a barrel in June 2005, sustaining a rally built on strong demand for gasoline and diesel and on concerns about refiners' ability to keep up.

The New York Mercantile Exchange (NYMEX) trades crude oil (including futures contracts) and provides the basis of US crude oil pricing via WTI (West Texas Intermediate). Other exchanges also trade crude oil futures, eg the International Petroleum Exchange (IPE) in London trades contracts in Brent crude.

See also History and Analysis of Crude Oil Prices (

Top petroleum producing countries

(Ordered by amount produced in 2003):

(Ordered by amount exported in 2003):

  • Saudi Arabia (OPEC)
  • Russia
  • Norway
  • Iran (OPEC)
  • United Arab Emirates (U.A.E) (OPEC)
  • Venezuela (OPEC)
  • Kuwait (OPEC)
  • Nigeria (OPEC)
  • Mexico
  • Algeria (OPEC)
  • Libya (OPEC)

Note that the USA consumes almost all of its own production.

Source: Energy Statistics from the U.S. Government (

See also: Organization of Petroleum Exporting Countries.

Related topics

External links



Books about the petroleum industry

Films about petroleum

Writers covering the petroleum industry

bg:Петрол ca:Petroli cs:Ropa cy:Petroliwm da:Rolie de:Erdl es:Petrleo eo:Nafto fr:Ptrole ko:석유 id:Minyak bumi it:Petrolio he:נפט lt:Nafta nl:Aardolie ja:石油 nb:Petroleum nn:Petroleum pl:Ropa naftowa pt:Petrleo ru:Нефть sl:Nafta sv:Petroleum vi:Dầu mỏ zh:石油


Academic Kids Menu

  • Art and Cultures
    • Art (
    • Architecture (
    • Cultures (
    • Music (
    • Musical Instruments (
  • Biographies (
  • Clipart (
  • Geography (
    • Countries of the World (
    • Maps (
    • Flags (
    • Continents (
  • History (
    • Ancient Civilizations (
    • Industrial Revolution (
    • Middle Ages (
    • Prehistory (
    • Renaissance (
    • Timelines (
    • United States (
    • Wars (
    • World History (
  • Human Body (
  • Mathematics (
  • Reference (
  • Science (
    • Animals (
    • Aviation (
    • Dinosaurs (
    • Earth (
    • Inventions (
    • Physical Science (
    • Plants (
    • Scientists (
  • Social Studies (
    • Anthropology (
    • Economics (
    • Government (
    • Religion (
    • Holidays (
  • Space and Astronomy
    • Solar System (
    • Planets (
  • Sports (
  • Timelines (
  • Weather (
  • US States (


  • Home Page (
  • Contact Us (

  • Clip Art (
Personal tools