Oil and natural gas remain the world's leading fuels, accounting for nearly 55% of global energy consumption
Oil and natural gas are formed from decaying plant and animal remains that became buried within layers of the earth and subjected to heat and pressure over millions of years. These two types of fossil fuels have been the world’s primary sources of energy for decades. They have enabled advances in quality of life and in all sectors of the economy, from residential lighting, cooking and heating to transportation and industrial manufacturing. However, the low carbon transition has put the oil and gas industry under pressure as these fuels are two of the main sources of greenhouse gases. The industry is associated with environmental disasters such as oil spills, and the prices of the two fuels – especially oil – are highly volatile with fluctuations directly impacted by political and socioeconomic events. Nevertheless, more than 100 countries currently produce oil and/or natural gas and the two fuels are expected to maintain their importance across the energy sector for many decades to come.
The production of oil and natural gas are often coupled as the two are typically found together in nature. The industry is commonly divided into three main operational sectors: upstream, midstream and downstream. The upstream sector incorporates the exploration and extraction of crude oil and natural gas reserves, while midstream focuses on transporting and storing the extracted products. The oil and natural gas then reach downstream processing facilities where they are refined, distributed and sold to the end customer. The product that reaches the end customer can take a number of forms including natural gas, liquefied petroleum gas (LPG), petrol, diesel fuel, jet fuel, heating oil, kerosene, asphalt and other petrochemicals. Several trends are currently impacting the future outlook of the oil and gas industry. The use of natural gas has increased across all economic sectors over the last few decades since natural gas – often viewed as a bridge fuel towards a low carbon energy system – burns cleaner than oil or coal for electricity generation. The switch to natural gas is becoming more widespread with the proliferation of the technology to liquify it (to LNG) for transport. Developments in shale gas and oil production have also greatly increased supply in the US, which has had implications in global oil, and increasingly LNG markets. Given a growing world population and continued demand for oil and gas products, discoveries of new deposits and advances in production technology will determine availability of supplies. Developments in carbon capture, use and storage (CCUS) will also impact the position of oil and natural gas in the long-term energy mix.
You can further explore the three sectors by clicking the links below:
Learn more about oil and gas extraction by exploring our Energy Insights.
For the latest news and articles on exploration and production read New Energy World.
Explore our dedicated collections on Aviation Fuel, Future of Gas, Road Fuels, Shale Gas and Working Offshore.
of global power generation was fuelled by gas in 2020 (IEA)
of methane emissions come from oil production, and the remaining 60% comes from leaks from the natural gas value chain (IEA)
supply chain jobs in decarbonisation of the UKCS, CCUS and hydrogen will be supported as part of the North Sea Transition Deal, published in 2021 (BEIS)
of the 40 million tonnes of carbon capture capacity currently in operation around the world is estimated to be used in natural gas processing (IEA)
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Events and training
EI LIVE | Human Factors Safety Critical Task Analysis - June 2023
12/06/2023 - 16/06/2023
A 5-day training course on Human Factors Safety Critical Task Analysis (SCTA). Delegates will be able to facilitate SCTA sessions of their own and kno...
Human Factors Foundation - October 2023
02/10/2023 - 06/10/2023
This 5-day course delivers a comprehensive introduction into human factors for non-specialists. It provides a practical, engaging and interactive back...
EI LIVE Maintenance Strategy Fundamentals - October 2023
04/10/2023 - 05/10/2023
In this 2 half-day training course, you will gain the fundamental knowledge and understanding to develop an efficient and effective maintenance plan t...
Introduction to Oil and Gas - October 2023
09/10/2023 - 10/10/2023
This 2-day training course provides delegates with an overview of principal activities in the international upstream, midstream and downstream petrole...
Economics of the Oil and Gas Industry - October 2023
16/10/2023 - 17/10/2023
A 2-day introduction to the economics of the oil and gas industry. This course is suitable for students who are new to the oil and gas industry.
Technical guidance publications
The risk of structural failure of decommissioned offshore oil and gas installations worldwide
This document is freely available to all registered users of this site. Log in to view the 'download' button.This short study examines the risks of st...
Investigation into the risk and impact associated with non-diesel fuel engine vehicles, by type, whilst entering or working within hazardous storage locations (Phase 3)
The Road to Zero sets out a path for zero emissions and ultra-low emission vehicles, clearly setting out a drive for manufacturers to develop and sell...
Guidelines for the medical and physical fitness requirements of emergency response team members
Produced by the EI's Health Technical Committee (HTC) to provide guidance to occupational physicians working in the international oil and gas industry...
Medical standards for fitness to wear respiratory protective equipment
This publication was produced by the Energy Institute’s Health Technical Committee (HTC) and will be of primary interest to occupational physici...
IP 601: Petroleum products – Determination of boiling range distribution by gas chromatography method – Part 4: Light fractions of crude oil
ScopeThis document specifies a method for the determination of the boiling range distribution of petroleum products by capillary gas chromatography us...