Petroleum - Modern history of oil on a Map

Petroleum, or crude oil, is a fossil fuel formed from organic matter over millions of years. It was used in ancient times for construction and medical purposes before its consumption surged in the 19th century.

Europe and North America rapidly increase energy requirements met by coal. Interest in oil intensifies worldwide, leading to the United States becoming the largest oil producer.

Crude oil is distilled in a refinery to separate hydrocarbons based on temperature ranges. Lighter molecules produce Liquefied Petroleum Gases, gasoline for cars, naphtha for petrochemicals, kerosene for aviation, and diesel/heating oil. The remaining high-sulfur residue forms heavy fuel oil and bitumen used in ships and road construction.

Oil discoveries lead to Venezuela becoming the second largest global oil producer. Western companies in the Middle East share profits with local countries through royalties, and demand for oil skyrockets during World War II.

Western companies dominate oil markets, fueling nationalist movements in producer countries. Saudi Arabia secures 50% of oil profits through an agreement. Iran's prime minister nationalizes the country's oil, leading to a US-UK coup attempt. The Shah of Iran permits Western companies to exploit the country's oil.

The discovery of oil fields in Western Siberia leads to the USSR investing in oil exploitation, making oil the primary source of energy worldwide. OPEC is created by five major oil-producing countries to counter Western dominance and increase oil prices.

After the Yom Kippur War, OPEC imposes an oil embargo to inflate prices and hits industrialized countries. This leads to a reduction in oil consumption, investment in alternative energy sources, and exploration for new offshore deposits.

Tensions between Iran and Iraq lead to an 8-year war, shifting the control of oil production from OPEC to non-OPEC countries. Western military vessels intervene in the Persian Gulf to protect oil facilities. After the war, Iraq becomes indebted but gains a powerful army, leading it to invade Kuwait and prompting international intervention led by the United States.

The United States establishes a permanent military presence and signs defense agreements with Gulf monarchies. It imposes embargoes on Iran and Iraq, while Saudi Arabia aims to become a major oil producer. The low oil prices lead to industry difficulties, prompting giant mergers among oil companies.

After the 9/11 terrorist attack, the US seeks new oil sources to reduce dependency on Saudi Arabia. Production accelerates in Africa and Iraq's invasion leads to its oil returning to the international market. Iran opens its market to rising Asian powers, stimulating global economy growth.

Global demand for oil drives up prices, making unconventional petroleum exploitation profitable. Canada and Venezuela rely on extracting thick bitumen from huge oil sand deposits, leading to deforestation and expensive, polluting transformation techniques.

Saudi Arabia aims to make the production of unconventional oil unprofitable by dropping prices, leading OPEC to flood the oil market and causing a drop in barrel prices. Despite this, the United States' oil industry continues to resist and increase its production.

World consumption of oil is approaching 100 million barrels per day, with the transportation industry being the main emitter of CO2. Heavy fuel oil used by ships emits 3,500 times more sulfur than diesel fuel, leading to severe air pollution. The United States and Europe have created zones where heavy fuel consumption is prohibited in response to this issue.

Saudi Arabia and OPEC countries seek to boost oil prices by collaborating with other producing nations, including Russia. Meanwhile, the United States becomes the world's largest oil producer by increasing production to support economic growth.

Despite the IPCC's call to reduce CO2 emissions, there is enough oil for at least 50 more years. Countries like Saudi Arabia and Iran are preparing for a post-oil era, while Venezuela struggles with low prices and political instability. The International Maritime Organization's sulfur emission goals may impact the industry by increasing demand and price.