Petroleum, which is Latin for rock oil, is a fossil fuel made naturally from decaying prehistoric plant and animal remains. It is a mixture of hundreds of different hydrocarbons molecules containing hydrogen and carbon that exist sometimes as a liquid (crude oil) and sometimes as a vapor (natural gas). Petroleum is a non-renewable source that is limited in quantity. Forecasts vary on how long the source will last based on many variables including demand, cost of extracting and increased use of renewable resources.

Millions of years ago, prehistoric plant and animal remains settled into the seas along with sand, silt and rocks. As the rocks and silt settled, layer upon layer piled up in rivers, along coastlines and on the sea floor trapping the organic material. Without air, the organic layers could not rot away. Over time, increasing pressure and temperature changed the mud, sand and silt into rock (known as source rock) and slowly “cooked” the organic matter into petroleum. The rock formation holds petroleum, like how a sponge holds water.

The oil and gas that formed in the source rock deep within the Earth moved upward through tiny, connected pore spaces in the rocks. Some seeped out at the Earth’s surface, but nonporous rocks or other barriers trapped most of the petroleum hydrocarbons. These underground traps of oil and gas are reservoirs. Contrary to popular misconception, reservoirs are not underground “lakes” of oil; they are porous and permeable rocks that can hold significant amounts of oil and gas within their pore spaces. Some reservoirs are hundreds of feet below the surface, while others are thousands of feet underground.

Oil 101. Student Energy, www.studentenergy.org


From ancient times through the early 1900s, finding oil and gas was largely a matter of luck. Early explorers looked for oil seeps at the surface, certain types of rock outcrops and other surface signs that oil might exist below ground. This was a haphazard process. However, science and technology quickly developed to improve the industry’s ability to determine what lies below the ground.

Geologists study rocks on the Earth’s surface and underground creating maps of the rocks where they think oil and gas might be found. Engineers use this geology map to drill a well under the Earth’s surface. If successful, the well will bring a steady flow of oil and gas to the surface. After the drill rig is removed, a pump is placed on the wellhead. An electric motor drives a gearbox that moves a lever. The lever pushes and pulls, forcing the pump up and down, and creates a suction that draws up the oil.

Three factors affect the amount of oil or gas that is recovered from a known reservoir: rock properties, technology and economics. While the industry cannot change the properties of the rock, it can develop new techniques to remove more oil from the rock. The industry has made significant advances to enhance recovery from known reservoirs worldwide, adding to the reserves base.

Many factors can affect oil and gas production, such as civil unrest, national or international politics, adherence to quotas, oil prices, oil demand, new discoveries and technology development or application.

The larger subsurface traps are the easiest deposits of oil and gas to locate. In mature production areas of the world, most of these large deposits of oil and gas are already found, and many have been producing since the 1960s and 1970s. The oil and gas industry has developed new technology to better identify and access oil and gas.Improved seismic techniques (such as 3D seismic) have increased the odds of correctly identifying the location of smaller and more difficult to find reservoirs.New drilling techniques can intersect a long, thin reservoir horizontally first that then turns vertically making an “L” shape. This enables the oil or gas from the reservoir to be recovered with fewer wells.

According to the Energy Information Administration (EIA), world oil production comes from approximately one million active oil wells. More than half of these wells are in the US, which has some of the most mature producing basins in the world. On average, the US produces 12 million barrels of oil per day, compared with 12.6 million in Russia and 10.5 million in Saudi Arabia.

There are still many oil and gas reserves left to be discovered and produced. Future discoveries will be in deeper basins and in more remote areas of the earth. Advanced technologies also can be used to locate small reservoirs found in existing oil and gas areas.