CRUDE OIL

Definition: Petroleum (Latin Petroleum derived from Greek πέτρα (Latin petra) - rock + έλαιον (Latin oleum) - oil) or crude oil is a naturally occurring liquid found in formations in the Earth consisting of a complex mixture of hydrocarbons (mostly alkanes) of various lengths. The approximate length range is C5H12 to C18H38. Any shorter hydrocarbons are considered natural gas or natural gas liquids, while long-chain hydrocarbons are more viscous, and the longest chains are paraffin wax. In its naturally occurring form, it may contain other nonmetallic elements such as sulfur, oxygen, and nitrogen.[1] It is usually black or dark brown (although it may be yellowish or even greenish) but varies greatly in appearance, depending on its composition. Crude oil may also be found in semi-solid form mixed with sand, as in the Athabasca oil sands in Canada, where it may be referred to as crude bitumen.

Petroleum is used mostly, by volume, for producing fuel oil and gasoline (petrol), both important "primary energy" sources. [2] 84% by volume of the hydrocarbons present in petroleum is converted into energy-rich fuels (petroleum-based fuels), including gasoline, diesel, jet, heating, and other fuel oils, and liquefied petroleum gas. [3]

Due to its high energy density, easy transportability and relative abundance, it has become the world's most important source of energy since the mid-1950s. Petroleum is also the raw material for many chemical products, including pharmaceuticals, solvents, fertilizers, pesticides, and plastics; the 16% not used for energy production is converted into these other materials.

Petroleum is found in porous rock formations in the upper strata of some areas of the Earth's crust. There is also petroleum in oil sands (tar sands). Known reserves of petroleum are typically estimated at around 1.2 trillion barrels without oil sands [4] , or 3.74 trillion barrels with oil sands [5] . However, oil production from oil sands is currently severely limited. Consumption is currently around 84 million barrels per day, or 3.6 trillion liters per year. Because of reservoir engineering difficulties, recoverable oil reserves are significantly less than total oil-in-place. At current consumption levels, and assuming that oil will be consumed only from reservoirs, known reserves would be gone around 2039, potentially leading to a global energy crisis. However, this ignores any new discoveries, rapidly increasing consumption in China & India, using oil sands, using synthetic petroleum, and other factors which may extend or reduce this estimate.

Formation

Chemistry
Octane, a hydrocarbon found in petroleum, lines are single bonds, black spheres are carbon, white spheres are hydrogenThe chemical structure of petroleum is composed of hydrocarbon chains of different lengths. These different hydrocarbon chemicals are separated by distillation at an oil refinery to produce gasoline, jet fuel, kerosene, and other hydrocarbons. The general formula for these alkanes is CnH2n+2. For example 2,2,4-trimethylpentane (isooctane), widely used in gasoline, has a chemical formula of C8H18 and it reacts with oxygen exothermically:


Incomplete combustion of petroleum or gasoline results in production of potentially toxic byproducts. Too little oxygen results in carbon monoxide. Combustion in air (which contains mostly nitrogen) results in nitric oxides. For example:


Formation of petroleum occurs in a variety of mostly endothermic reactions in high temperature and/or pressure. For example, a kerogen may break down into hydrocarbons of different lengths.

Biogenic theory
Most geologists view crude oil and natural gas as the product of compression and heating of ancient organic materials over geological time. Oil is formed from the preserved remains of prehistoric zooplankton and algae which have been settled to the sea (or lake) bottom in large quantities under anoxic conditions. Terrestrial plants, on the other hand, tend to form coal. Over geological time this organic matter, mixed with mud, is buried under heavy layers of sediment. The resulting high levels of heat and pressure cause the organic matter to chemically change during diagenesis, first into a waxy material known as kerogen which is found in various oil shales around the world, and then with more heat into liquid and gaseous hydrocarbons in a process known as catagenesis.

Geologists often refer to an "oil window" which is the temperature range that oil forms in—below the minimum temperature oil remains trapped in the form of kerogen, and above the maximum temperature the oil is converted to natural gas through the process of thermal cracking. Though this happens at different depths in different locations around the world, a 'typical' depth for the oil window might be 4–6 km. Note that even if oil is formed at extreme depths, it may be trapped at much shallower depths, even if it is not formed there (the Athabasca Oil Sands is one example).

Hydrocarbon trap.Because most hydrocarbons are lighter than rock or water, these often migrate upward through adjacent rock layers until they they either reach the surface or become trapped beneath impermeable rocks, within porous rocks called reservoirs. However, the process is not straightforward since it is influenced by underground water flows, and oil may migrate hundreds of kilometres horizontally or even short distances downward before becoming trapped in a reservoir. Concentration of hydrocarbons in a trap forms an oil field, from which the liquid can be extracted by drilling and pumping.

Three conditions must be present for oil reservoirs to form: first, a source rock rich in organic material buried deep enough for subterranean heat to cook it into oil; second, a porous and permeable reservoir rock for it to accumulate in; and last a cap rock (seal) or other mechanism that prevents it from escaping to the surface. Within these reservoirs fluids will typically organize themselves like a three-layer cake with with a layer of water below the oil layer and a layer of gas above it, although the different layers vary in size between reservoirs.

The vast majority of oil that has been produced by the earth has long ago escaped to the surface and been biodegraded by oil-eating bacteria. Oil companies are looking for the small fraction that has been trapped by this rare combination of circumstances. Oil sands are reservoirs of partially biodegraded oil still in the process of escaping, but contain so much migrating oil that, although most of it has escaped, vast amounts are still present - more than can be found in conventional oil reservoirs. On the other hand, oil shales are source rocks that have never been buried deep enough to convert their trapped kerogen into oil.

The reactions that produce oil and natural gas are often modeled as first order breakdown reactions, where kerogen is broken down to oil and natural gas by a set of parallel reactions, and oil eventually breaks down to natural gas by another set of reactions. The first set was originally patented in 1694 under British Crown Patent No. 330 covering,

"a way to extract and make great quantityes of pitch, tarr, and oyle out of a sort of stone."

The latter set is regularly used in petrochemical plants and oil refineries.


Abiogenic theory
Abiogenic petroleum origin
The idea of abiogenic petroleum origin was championed in the Western world by astronomer Thomas Gold based on thoughts from Russia, mainly on studies of Nikolai Kudryavtsev. The idea proposes that hydrocarbons of purely geological origin exist in the planet. Hydrocarbons are less dense than aqueous pore fluids, and are proposed to migrate upward through deep fracture networks. Thermophilic, rock-dwelling microbial life-forms are proposed to be in part responsible for the biomarkers found in petroleum.

This theory is a minority opinion, especially amongst Western geologists; no Western oil companies are currently known to explore for oil based on this theory, although Russia is known to have applied this theory with some success.[citation needed]

Classification
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 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. Each crude oil has unique molecular characteristics which are understood by the use of crude oil assay analysis in petroleum laboratories.

Barrels from an area in which the crude oil's molecular characteristics have been determined and the oil has been classified are used as pricing references throughout the world. These references are known as Crude oil benchmarks:

Brent Crude, comprising 15 oils from fields in the Brent and Ninian systems in the East Shetland Basin of the North Sea. The oil is landed at Sullom Voe terminal in the Shetlands. Oil production from Europe, Africa and Middle Eastern oil flowing West tends to be priced off the price of this oil, which forms a benchmark.
West Texas Intermediate (WTI) for North American oil.
Dubai, used as benchmark for Middle East oil flowing to the Asia-Pacific region.
Tapis (from Malaysia, used as a reference for light Far East oil)
Minas (from Indonesia, used as a reference for heavy Far East oil)
The OPEC Reference Basket, a weighted average of oil blends from various OPEC (The Organization of the Petroleum Exporting Countries) countries.

Means of production
Extraction
The most common method of obtaining petroleum is extracting it from oil wells found in oil fields. With improved technologies and higher demand for hydrocarbons various methods are applied in petroleum exploration and development to optimize the recovery of oil and gas. Primary recovery methods are used to extract oil that is brought to the surface by underground pressure, and can generally recover about 20% of the oil present. The natural pressure can come from several different sources; where it is provided by an underlying water layer it is called a water drive reservoir and where it is from the gas cap above it is called gas drive. After the reservoir pressure has depleted to the point that the oil is no longer brought to the surface, secondary recovery methods draw another 5 to 10% of the oil in the well to the surface. In a water drive oil field, water can be injected into the water layer below the oil, and in a gas drive field it can be injected into the gas cap above to repressurize the reservoir. Finally, when secondary oil recovery methods are no longer viable, tertiary recovery methods reduce the viscosity of the oil in order to bring more to the surface. These generally involve the injection of heat and/or solvents.

Alternative methods
During the last oil price peak, other alternatives to producing oil gained importance. The best known such methods involve extracting oil from sources such as oil shale or tar sands. These resources are known to exist in large quantities; however, extracting the oil at low cost without negatively impacting the environment remains a challenge.

It is also possible to transform natural gas or coal into oil (or, more precisely, the various hydrocarbons found in oil). The best-known such method is the Fischer-Tropsch process. It was a concept pioneered in Nazi Germany when imports of petroleum were restricted due to war and Germany found a method to extract oil from coal. It was known as Ersatz ("substitute" in German), and accounted for nearly half the total oil used in WWII by Germany. However, the process was used only as a last resort as naturally occurring oil was much cheaper. As crude oil prices increase, the cost of coal to oil conversion becomes comparatively cheaper. The method involves converting high ash coal into synthetic oil in a multi-stage process. Ideally, a ton of coal produces nearly 200 liters (1.25 bbl, 52 US gallons) of crude, with by-products ranging from tar to rare chemicals.

Currently, two companies have commercialised their Fischer-Tropsch technology. Shell in Bintulu, Malaysia, uses natural gas as a feedstock, and produces primarily low-sulfur diesel fuels. [8] Sasol [9] in South Africa uses coal as a feedstock, and produces a variety of synthetic petroleum products.

The process is today used in South Africa to produce most of the country's diesel fuel from coal by the company Sasol. The process was used in South Africa to meet its energy needs during its isolation under Apartheid. This process has received renewed attention in the quest to produce low sulfur diesel fuel in order to minimize the environmental impact from the use of diesel engines.

An alternative method of converting coal into petroleum is the Karrick process, which was pioneered in the 1930s in the United States. It uses high temperatures in the absence of ambient air, to distill the short-chain hydrocarbons of petroleum out of coal.

More recently explored is thermal depolymerization (TDP), a process for the reduction of complex organic materials into light crude oil. Using pressure and heat, long chain polymers of hydrogen, oxygen, and carbon decompose into short-chain petroleum hydrocarbons. This mimics the natural geological processes thought to be involved in the production of fossil fuels. In theory, TDP can convert any organic waste into petroleum.

History
Petroleum, in some form or other, is not a substance new in the world's history. More than four thousand years ago, according to Herodotus and confirmed by Diodorus Siculus, asphalt was employed in the construction of the walls and towers of Babylon; there were oil pits near Ardericca (near Babylon), and a pitch spring on Zacynthus.[10] Great quantities of it were found on the banks of the river Issus, one of the tributaries of the Euphrates. Ancient Persian tablets indicate the medicinal and lighting uses of petroleum in the upper levels of their society.

The earliest known oil wells were drilled in China in 347 CE or earlier. They had depths of up to about 800 feet (244 m) and were drilled using bits attached to bamboo poles. The oil was burned to evaporate brine and produce salt. By the 10th century, extensive bamboo pipelines connected oil wells with salt springs. The ancient records of China and Japan are said to contain many allusions to the use of natural gas for lighting and heating. Petroleum was known as burning water in Japan in the 7th century.

The Middle East petroleum industry was established by the 8th century, when the streets of the newly constructed Baghdad were paved with tar, derived from easily accessible petroleum from natural fields in the region. In the 9th century, oil fields were exploited in the area around modern Baku, Azerbaijan, to produce naphtha. These fields were described by the geographer Masudi in the 10th century, and by Marco Polo in the 13th century, who described the output of those wells as hundreds of shiploads. Petroleum was distilled by Persian chemist al-Razi in the 9th century, producing chemicals such as kerosene in the al-ambiq. (See also: Alchemy (Islam), Islamic science, and Timeline of science and technology in the Islamic world.)

The earliest mention of American petroleum occurs in Sir Walter Raleigh's account of the Trinidad Pitch Lake in 1595; whilst thirty-seven years later, the account of a visit of a Franciscan, Joseph de la Roche d'Allion, to the oil springs of New York was published in Sagard's Histoire du Canada. A Russian traveller, Peter Kalm, in his work on America published in 1748 showed on a map the oil springs of Pennsylvania.

The modern history of petroleum began in 1846 with the discovery of the process of refining kerosene from coal by Nova Scotia's Abraham Pineo Gesner.

Oil sands were mined from 1745 in Merkwiller-Pechelbronn, Alsace under the direction of Louis Pierre Ancillon de la Sablonnière, by special appointement of Louis XV.  The Pechelbronn oil field was active until 1970, and was the birth place of companies like Antar and Schlumberger. The first modern refinery was built there in 1857.

Poland's Ignacy Łukasiewicz improved Gesner's method to develop a means of refining kerosene from the more readily available "rock oil" ("petr-oleum") seeps in 1852 and the first rock oil mine was built in Bóbrka, near Krosno in southern Poland in the following year. These discoveries rapidly spread around the world, and Meerzoeff built the first Russian refinery in the mature oil fields at Baku in 1861. At that time Baku produced about 90% of the world's oil.

Environmental effects
Diesel fuel spill on a roadThe presence of oil has significant social and environmental impacts, from accidents and routine activities such as seismic exploration, drilling, and generation of polluting wastes not produced by other alternative energies.


Extraction
Oil extraction is costly and sometimes environmentally damaging, although Dr. John Hunt of the Woods Hole Oceanographic Institution 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. [14] But at the same time, offshore oil platforms also form micro-habitats for marine creatures. Extraction may involve dredging, which stirs up the seabed, killing the sea plants that marine creatures need to survive.


Oil spills
Volunteers cleaning up the aftermath of the Prestige oil spillCrude oil and refined fuel spills from tanker ship accidents have damaged natural ecosystems in Alaska, the Galapagos Islands, France and many other places and times in Spain (i.e. Ibiza).

The quantity of oil spilled during accidents has ranged from a few hundred tons to several hundred thousand tons (Atlantic Empress, Amoco Cadiz...). Smaller spills have already proven to have a great impact on ecosystems, such as the Exxon Valdez oil spill

Global warming
Main article: Global warming
Burning oil releases carbon dioxide into the atmosphere, which contributes to global warming. Per energy unit, oil produces less CO2 than coal, but more than natural gas. However, oil's unique role as a transportation fuel makes reducing its CO2 emissions a particularly thorny problem; amelioration strategies such as carbon sequestering are generally geared for large power plants, not individual vehicles.

Whales
It has been argued that the advent of kerosene was one development, which saved the great cetaceans from extinction.

Alternatives to petroleum
Renewable energy

Alternatives to petroleum-based vehicle fuels

The term alternative propulsion or "alternative methods of propulsion" includes both:
alternative fuels used in standard or modified internal combustion engines (i.e. combustion hydrogen or biofuels).
propulsion systems not based on internal combustion, such as those based on electricity (for example, all-electric or hybrid vehicles), compressed air, or fuel cells (i.e. hydrogen fuel cells).
Nowadays, cars can be classified between the next main groups:

Petro-cars, this is, only use petroleum and biofuels (biodiesel and biobutanol).
Hybrid vehicle and plug-in hybrids, that use petroleum and other source, generally, electricity.
Petrofree car, that can not use petroleum, like electric cars, hydrogen vehicles...

The future of petroleum production

Hubbert peak theory
The Hubbert peak theory (also known as peak oil) is a proposition which predicts that future world petroleum production must inevitably reach a peak and then decline at a similar rate to the rate of increase before the peak as these reserves are exhausted. It also suggests a method to calculate mathematically the timing of this peak, based on past production rates, past discovery rates, and proven oil reserves.

Controversy surrounds the theory for numerous reasons. Past predictions regarding the timing of the global peak have failed, causing a number of observers to disregard the theory. Further, predictions regarding the timing of the peak are highly dependent on the past production and discovery data used in the calculation.

Proponents of peak oil theory also refer as an example of their theory, that when any given oil well produces oil in similar volumes to the amount of water used to obtain the oil, it tends to produce less oil afterwards, leading to the relatively quick exhaustion and/or commercial inviability of the well in question.

The issue can be considered from the point of view of individual regions or of the world as a whole. Hubbert's prediction for when US oil production would peak turned out to be correct, and after this occurred in 1971 - causing the US to lose its excess production capacity - OPEC was finally able to manipulate oil prices, which led to the 1973 oil crisis. Since then, most other countries have also peaked: the United Kingdom's North Sea, for example in the late 1990s. China has confirmed that two of its largest producing regions are in decline, and Mexico's national oil company, Pemex, has announced that Cantarell Field, one of the world's largest offshore fields, was expected to peak in 2006, and then decline 14% per annum.

It is difficult to predict the oil peak in any given region (due to the lack of transparency in accounting of global oil reserves) . Based on available production data, proponents have previously (and incorrectly) predicted the peak for the world to be in years 1989, 1995, or 1995-2000. Some of these predictions date from before the recession of the early 1980s, 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. [citation needed] Just as the 1971 U.S. peak in oil production was only clearly recognized after the fact, a peak in world production will be difficult to discern until production clearly drops off.

Many proponents of the Hubbert peak theory expound the belief that the production peak is imminent, for various reasons. The year 2005 saw a dramatic fall in announced new oil projects coming to production from 2008 onwards - in order to avoid the peak, these new projects would have to not only make up for the depletion of current fields, but increase total production annually to meet increasing demand.

The year 2005 also saw substantial increases in oil prices due to a number of circumstances, including war and political instability. Oil prices rose to new highs. Analysts such as Kenneth Deffeyes argue that these price increases indicate a general lack of spare capacity, and the price fluctuations can be interpreted as a sign that peak oil is imminent.

Pricing
Main articles: Price of petroleum and Oil price increases of 2004-2007


International market
Main article: Petroleum Industry

Oil consumption per capita (darker colors represent more consumption).

Petroleum efficiency among countries
There are two main ways to measure the petroleum efficiency of countries: by population or by GDP (gross domestic product). This metric is important in the global debate over oil consumption/energy consumption/climate change because it takes social and economic considerations into account when scoring countries on their oil consumption/energy consumption/climate change goals. Nations such as China and India with large populations tend to promote the use of population based metrics, while nations with large economies such as the United States would tend to promote the GDP based metric, according to unconfirmed sources.

Selected Nations Oil Efficiency (US dollar/barrel/day)
Switzerland 3.75
United Kingdom 3.34
Norway 3.31
Austria 2.96
France 2.65
Germany 2.89
Sweden 2.71
Italy 2.57
European Union 2.52
DRC 2.4
Japan 2.34
Australia 2.21
Spain 1.96
Bangladesh 1.93
Poland 1.87
United States 1.65
Belgium 1.59
World 1.47
Turkey 1.39
Canada 1.35
Mexico 1.07
Ethiopia 1.04
South Korea 1.00
Philippines 1.00
Brazil 0.99
Taiwan 0.98
China 0.94
Nigeria 0.94
Pakistan 0.93
Myanmar 0.89
India 0.86
Russia 0.84
Indonesia 0.71
Vietnam 0.61
Thailand 0.53
Saudi Arabia 0.46
Egypt 0.41
Singapore 0.40
Iran 0.35
Selected Nations Oil Efficiency (barrel/person/year)
DRC 0.13
Ethiopia 0.37
Bangladesh 0.57
Myanmar 0.73
Pakistan 1.95
Nigeria 2.17
India 2.18
Vietnam 2.70
Philippines 3.77
Indonesia 4.63
China 4.96
Egypt 7.48
Turkey 9.85
Brazil 11.67
Poland 11.67
World 12.55
Thailand 13.86
Russia 17.66
Mexico 18.07
Iran 21.56
European Union 29.70
United Kingdom 30.18
Germany 32.31
France 32.43
Italy 32.43
Austria 34.01
Spain 35.18
Switzerland 34.64
Sweden 34.68
Taiwan 41.68
Japan 42.01
Australia 42.22
South Korea 43.84
Norway 52.06
Belgium 61.52
United States 68.81
Canada 69.85
Saudi Arabia 75.08
Singapore 178.45

(Note: The figure for Singapore is skewed because of its small
population compared with its large oil refining capacity.
Most of this oil is sent to other countries.)

Top petroleum-producing countries
Source: Energy Statistics from the U.S. Government.

For oil reserves by country, see Oil reserves by country.


Oil producing countriesIn order of amount produced in 2004 in MMbbl/d & ML/d:

# Producing Nation for 2004 (×106bbl/d) (×10³m³/d)
1 Saudi Arabia (OPEC) 10.37 1,649
2 Russia 9.27 1,474
3 United States 1 8.69 1,382
4 Iran (OPEC) 4.09 650
5 Mexico 1 3.83 609
6 China 1 3.62 576
7 Norway 1 3.18 506
8 Canada 1,3 3.14 499
9 Venezuela (OPEC) 1 2.86 455
10 United Arab Emirates (OPEC) 2.76 439
11 Kuwait (OPEC) 2.51 399
12 Nigeria (OPEC) 2.51 399
13 United Kingdom 1 2.08 331
14 Iraq (OPEC) ² 2.03 323

1 peak production of conventional oil already passed in this state

² Though still a member, Iraq has not been included in production figures since 1998

³ Canada has the world's second largest oil reserves when tar sands are included, and is the leading source of U.S. imports, averaging 1.7 MMbbl/d in April 2006 [1].

Top petroleum-exporting countries

Oil exports by countryIn order of amount exported in 2003:

Saudi Arabia (OPEC)
Russia
Norway 1
Iran (OPEC)
United Arab Emirates (OPEC)
Venezuela (OPEC) 1
Kuwait (OPEC)
Nigeria (OPEC)
Mexico 1
Algeria (OPEC)
Libya (OPEC) 1
1 peak production already passed in this state

Note that the USA consumes almost all of its own production, while the UK has recently become a net-importer rather than net-exporter.

Total world production/consumption (as of 2005) is approximately 84 million barrels per day.

See also: Organization of Petroleum Exporting Countries.


Top petroleum-consuming countries
# Consuming Nation (bbl/day) (m³/day)
1 United States 20,030,000 3,184,516
2 China 6,391,000 1,016,088
3 Japan 5,578,000 886,831
4 Russia 2,800,000 445,164
5 Germany 2,677,000 425,609
6 India 2,320,000 368,851
7 Canada 2,300,000 365,671
8 South Korea 2,061,000 327,673
9 France 2,060,000 327,514
10 Italy 1,874,000 297,942
11 Saudi Arabia 1,775,000 282,202
12 Mexico 1,752,000 278,546
13 United Kingdom 1,722,000 273,776
14 Brazil 1,610,000 255,970

Source: CIA World Factbook

Top petroleum-importing countries

Oil imports by country# Importing Nation (bbl/day) (m³/day)
1 United States 13,150,000 2,790,683
2 Japan 5,449,000 866,322
3 China 3,226,000 512,893
4 Netherlands 2,284,000 363,127
5 France 2,281,000 362,650
6 South Korea 2,263,000 359,788
7 Italy 2,158,000 343,095
8 Germany 2,135,000 339,438
9 India 2,090,000 332,283
10 Spain 1,582,000 251,518
11 United Kingdom 1,084,000 172,342
12 Belgium 1,042,000 165,665
13 Canada 963,000 153,105
14 Turkey 616,500 98,016

Source: CIA World Factbook


Top petroleum non-producing and consuming countries
# Consuming Nation (bbl/day) (m³/day)
1 Japan 5,578,000 886,831
2 Germany 2,677,000 425,609
3 India 2,320,000 368,851
4 South Korea 2,061,000 327,673
5 France 2,060,000 327,514
6 Italy 1,874,000 297,942
7 Spain 1,537,000 244,363
8 Netherlands 946,700 150,513

Source : CIA World Factbook


Writers covering the petroleum industry
Brian Black
Colin J. Campbell
Kenneth S. Deffeyes
Thomas Gold
David Goodstein
Jay Hanson
Daniel Yergin
Derrick Jensen

Mamadou Ly