How Oil Works
Oil has been a defining force in the 20th century. Oil has shaped political boundaries, defined the outcome of battles and wars, created and disrupted economies, and remade the urban environment. It has also taken a heavy toll on the environment, through air pollution and oil spills.
We are burning through our supplies of oil so quickly that oil may become a uniquely 20th century phenomenon. American oil production is fading fast, even as demand rises. Worldwide reserves of oil could supply 40 to 60 years of consumption at current rates. By the middle of the 21st century, world oil supplies could be dwindling. Environmental pressures may lead to restrictions on its use before then.
How Oil Is Formed
Oil is formed from ancient plants and animals deposited since the Cambrian period 500 million years ago. This organic matter settled on the sea floors of that era, mixing with and being covered by sedimentary rocks, mostly sandstone and limestone. Over many years, deposits of more sediments, tectonic plate movements or volcanic activity buried these deposits under an impermeable layer of stone or mud.
Trapped under high pressure, with no oxygen present, bacteria broke down the dead plants and animals into hydrocarbons, such as coal, oil and natural gas. Once formed in this sedimentary layer, oil can be squeezed out or washed out by underground water flows. Since natural gas is less dense than oil, and oil is less dense than water, the gas tends to float on top, with oil under it, supported by water.
Oil is not actually in pools underground; it is held in permeable rock, such as sandstone or ancient coral reefs, like a sponge. Gas, oil and water would rise to the surface over time, but they are held underground by a "cap rock" such as a layer of shale. Oil and gas become concentrated in areas where there are high spots, or domes, under the layer of cap rock.
The most common type of oil trap occurs in an "anticline." Anticlines are formed when the cap rock is buckled by geological movement, as when mountains are formed. The most recent major anticline formation was 20 million years ago, when the Alps, the Himalayas and the Rocky Mountains were formed.
How Oil Is Found: 3-D Seismic Analysis
The first method of prospecting for oil was no more complicated than finding oil seeping out of the ground. In places where the cap rock is thin, such as in parts of Iran and Kuwait, oil and gas leak from their reservoirs onto the surface. It is suspected that the famous "burning bush" of the biblical era was in fact a natural gas leak that ignited.
In West Virginia in the first half of the 19th century, water drills would routinely bring up water contaminated with oil. This "rock oil" was considered to have some medicinal values, but no practical application. But due to the decline of the whaling industry in the 1850s, and the beginning of the industrial revolution, a new source of fuel was needed to replace whale oil for lamps. Suddenly Appalachian rock oil was worth more than water.
In 1859, the first oil well was drilled near Titusville, Pennsylvania, striking oil at 69.5 feet. After looking for seepages, the first method of oil exploration was to look for geographical features on the surface that suggested a possible anticline below. Exploration teams scoured the countryside on foot and mule back, mapping promising areas. When a good location was found, a shallow well was sunk. If oil was found, a mad rush was sure to follow.
Until 1919, surface mapping and study of surface rocks, followed by a typically unsuccessful exploratory well, was the only way to find oil. That year, the first seismic prospecting was begun in Europe. Seismic prospecting involves setting off an explosive shock at the surface, and monitoring the speed of the shock waves that bounce off the geological structures below. A series of listening devices, called "geophones" are set at fixed distances away from the shock; they record the strength and timing of the signal.
Given the limited data processing capabilities of the day, only major formations could be found with seismic prospecting. But with a number of computer-aided refinements, this method is still in use today. By using high powered computers, exploration geologists can set out ever more geophones, analyze more shockwave trajectory possibilities, and look deeper into the earth with greater accuracy. After the data are analyzed, the results are displayed in three-dimensional color. Yet despite all this technology, wells are not always successful. As the saying goes, the only way to discover oil is with a drill.
How Oil Is Drilled
The first oil well, in Titusville, was a "cable tool rig." A heavy iron bit, tipped with steel, was suspended by a cable from a drilling derrick and repeatedly smashed into the ground. After it broke through the rock for a while, it was hoisted out and a "bailer" was dropped down the hole to remove the rock fragments. Although laborious and slow, this method was still used as late as the 1960s, for shallow wells in rocky areas.
Rotary drills are more common today. Although some rotary drills were in operation for water wells as early as 1823, the method did not become widespread in the U.S. until 1900. By 1930s it was the dominant form of drilling, used extensively in the deep wells of Oklahoma, Texas and California.
In a rotary drill, a sharp tip of diamonds embedded in hardened steel bites into the ground, connected to motors on the surface by a long string of drilling pipes. The pipes, about 30 feet long each, are screwed together into strings as long as 24,000 feet, weighing up to 100 tons. Muddy water is pumped down through the drilling pipes to carry the chips of rock cut by the drill back to the surface. A battery of internal combustion or electric motors powers the rig.
Environmental Impacts of Oil Shipping and Use
After oil is brought to the surface, it is piped away from the rig to waiting boats or refineries. Crude oil from the Middle East is shipped by tanker ships to Europe, the US and the Pacific Rim. At 400 meters long, with a cargo capacity of 500,000 tons, supertankers are the largest moving things ever built. The 6600 boats in operation carry 524 billion gallons of oil every year. Each year, about 200 tankers load up at the port of Valdez, the outlet for the Alaska pipeline. Houston and New York are the busiest US ports, each receiving four or five tankers a day of imported oil.
Although oil drilling and extraction can lead to environmental problems, like groundwater contamination, the worst impacts from oil use are at the shipping, refining and use stages of the process. The most graphic type of impact is an oil spill. Between 1973 and 1993 there were over 200,000 oil spills in US waters, dumping over 230 million gallons of oil. Incredibly, that is an average of 28 "incidents" per day, spilling 31,000 gallons of oil every day for 20 years into our water ways.
Before supertankers, smaller ships were used to transport refined oil products, like gasoline and heating oil. Because these products are lighter than crude oil, they tend to evaporate when they are spilled. When crude oil is spilled in water, it quickly spreads out on top of the water. The Exxon Valdez spill covered 1300 square miles of water and coastline. When birds land on the water, their feathers are coated with oil, causing them to sink and drown. Crude oil spilled in coastal areas can destroy coral reefs and mangrove swamps.
While the Exxon Valdez spill was the largest single spill in American waters and an unparalleled ecological disaster, it was only 11 million gallons. By comparison, oil intentionally released from Kuwaiti refineries and terminals by Iraqi troops amounted to 250 million gallons. In addition, they lit more than 700 oil wells, putting hundreds of tons of smoke and toxic chemicals into the air. In a list of the world's largest oil spills between 1967 and 1992, the Exxon Valdez spill ranks as number 36.
The National Research Council estimates that almost a billion gallons of oil are spilled into the world's oceans and waterways each year. And as bad as tanker spills can be, they amount to only 13 percent of the total oil lost. Municipal and industrial wastes, urban runoff, leaking pipelines and storage tanks and standard tanker operations, such as dumping ballast water, all contribute to marine pollution.
And as bad as marine pollution can be, air pollution from oil is even worse. Transportation accounts for half of nitrogen oxide emissions in the US, and a third of carbon dioxide emissions, and a host of other air emissions, including carbon monoxide, ozone, sulfur oxides, particulates, volatile organic compounds, methane and toxic metals. These emissions contribute to urban smog, acid rain and global warming, causing health problems in humans and animals, damage to crops, forests and buildings, degradation of habitat... the list seems endless.
Unfortunately, one of the worst culprits in causing air and water pollution from oil is not some large corporation -- it is each and every one of us who owns and drives a car. Gas evaporates as we pump it into our cars, and when we spill it on the ground, contributing to smog. Oil drips from our engines, and finds its way into lakes and rivers. We drive increasingly large and inefficient cars an ever greater distance every year.
While car makers and gas producers bear some responsibility in reducing our dependence on polluting oil, we must also take some personal responsibility. The solution to pollution is you.
Current Use of Oil
America now accounts for over 25 percent of the world's oil consumption, about 17 million barrels of oil per day. At the same time, we produce only 13 percent of the world's total. Two-thirds of the oil used in the US goes for transportation. The US gets about 40 percent of its primary energy from oil.
For every year since 1994, over half the oil we use has imported. If we were to rely solely on American oil, our reserves would be depleted within 15 years. US oil production has been declining steadily since the early 1980s as fields are exhausted. New discoveries of oil in the US have also been declining, leading experts to believe that no new large sources of oil can be expected.
In inflation-adjusted dollars, gasoline prices are lower now than they have ever been in America, while the total state and federal gas tax is almost unchanged since the 1940s. In 1980, during the second oil crisis, a gallon of gasoline cost twice what it does today. Even in the auto-loving 1950s, when cars got less than half the mileage they get today, drivers paid more than 50 cents more per gallon than we do now.
It's little wonder, then, that oil consumption in the US is rapidly outpacing domestic oil production, and has steadily risen since the mid-1980s. If it weren't for the improved fuel economy of cars that resulted from the federal fuel efficiency standards (CAFE standards), oil consumption would be much worse. In recent years, as large and inefficient sport utility vehicles have been adopted as family cars, oil consumption is on the rise again.
The Future
Worldwide, oil accounts for about 40 percent of the primary energy produced. At current rates of production, about 65 million barrels per day, world oil supplies are predicted to last 60 to 70 years. Although discovery and extraction technologies may improve, pushing that date back, demand is likely to rise too, resulting in a quicker exhaustion.
Long before the world actually runs out of oil, there are likely to be major price fluctuations as supplies grow scarce. These fluctuations have proven to be extremely damaging to countries who are dependent on oil, like the US. When the OPEC oil embargo happened in the 1970s, the US imported about 37 percent of the oil we use, two-thirds of this coming from OPEC countries, which controlled about 36 percent of the world market for oil. Now, although OPEC doesn't have the dominating control it once had, the US is even more dependent on imports, importing more than half our oil every year since 1994. About half of this oil comes from OPEC countries, primarily Saudi Arabia and Venezuela.
While economic disruptions and resource depletion are bound to happen sooner or later, the environmental burden of oil demands that we change our energy habits long before then. Above all, global warming requires a shift to cleaner and more efficient technologies.
Two main approaches will encourage more responsible use of oil in the future -- new transportation technologies and more accurate pricing of the costs of transportation.
New Technologies
In recent years there has been something of a design renaissance for cars and trucks, with electric, fuel cell and hybrid cars coming to showroom floors.
Battery, fuel cell, and hybrid vehicles use electrical motors, rather than a mechanical transmission, offering substantial efficiency improvements over the drivetrain of conventional vehicles.
Battery-powered vehicles use chemical batteries to store electricity for the vehicle, generated at power plants. Most power in the US comes from coal and nuclear fuels, though cleaner sources like wind, solar, geothermal and biomass offer a more sustainable path. Fuel cell and hybrid vehicles generate their electricity from liquid and gaseous fuels right on board. While these vehicles could use petroleum-derived products like gasoline and methanol, they could also use renewable fuels like ethanol, or even hydrogen.
Even using oil-based fuels, these advanced vehicles produce zero or near-zero tailpipe emissions. When the electricity and fuels used in electric vehicles are produced from renewable energy sources, advanced vehicles offer additional reductions in fossil fuel energy consumption and in emissions of carbon dioxide.
Proper Pricing
A more fundamental problem with oil is that the cost to consumers of owning and operating a car does not reflect its full price to society. Drivers do not directly pay the monetary costs of global warming, air pollution, water pollution, and oil dependence. Instead, everyone pays for the impacts on public health and the US economy.
Some pricing solutions include having drivers buy car insurance on a per-use basis by paying for it at the fuel pump, raising tolls on congested bridges and roads during peak travel times, increasing gasoline taxes, and offering employees cash or transit vouchers in place of subsidized parking.
State governments could also enact incentives to encourage consumers to buy cleaner, more efficient vehicles. One approach would be to base annual vehicle registration fees on emissions. Another, a "feebate" system, would place a surcharge on gas guzzlers and/or high polluters to finance rebates for the purchase of cars with better fuel efficiency and/or lower emissions.
Proper pricing will also encourage people to get out of their cars altogether, relying on mass transit, walking and cycling to get around. Ultimately, pricing transportation properly could mean that people will move closer to work and school, thus reducing their need to travel.
Further Reading
"Preventing the Next Oil Crunch," Scientific American, March 1998.
British Petroleum, "BP Statistical Review of World Energy."
Daniel Yergin, The Prize: The Epic Quest for Oil, Money and Power, Touchstone Press, 1992. Also a PBS documentary.
