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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 records published on our Energy Matrix.

For the latest news and articles on exploration and production read Petroleum Review.

Find the latest oil and gas consultations and policies in our Policy Milestones Calendar.

What's new?

Upstream gas and LNG lead global oil and gas investment in 2022

12/01/2022
Global oil and gas investments will expand by $26bn in 2022 to reach $602bn (a rise of 4%) as the industry continues its protracted recovery from the ...

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2021 forecast to be lowest level of global oil and gas discoveries in 75 years

22/12/2021
Global oil and gas discoveries in 2021 look set to hit their lowest level in 75 years, should December fail to yield any significant finds, reports Ry...

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UK government seeks views on oil and gas ‘climate checkpoint’

22/12/2021
The UK government has launched a consultation on the design of a new climate compatibility checkpoint for the oil and gas industry, following its comm...

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UK government consultation on new climate compatibility checkpoint for the oil and gas industry

22/12/2021
The UK government has launched a consultation on the design of a new climate compatibility checkpoint for the oil and gas industry. The checkpoint wil...

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Ecuador’s key oil and gas projects tied to policy incentives to boost struggling economy

08/12/2021
The government of Ecuador plans to attract $19bn of investment into its oil and gas sector at a time when the global industry is shedding non-cor...

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Events and training

Cyber Security for Critical Assets MENA Summit

24/01/2022
For more information and to register, please visit: https://mena.cs4ca.com/ 

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EI LIVE free webinar | Waste to Energy and Other Useful Products

15/02/2022
Arq cleans up hazardous mining waste sites by transforming refuse materials into Arq powder™, a micro-fine, high-value, advanced carbon pro...

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EI LIVE free webinar |3 critical ways maintenance improves wind turbine performance

18/02/2022
Discover 3 critical areas within asset management, maintenance and reliability that you can improve your equipment performance and reliability in the ...

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Technical guidance publications

HM 75. A guide to uncertainty of measurement in the oil and gas industry

2021
Uncertainty is a very important feature of measurement data analysis and management in the oil and gas industry.This publication presents an overview ...

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HM 25. Guidelines for the assessment of uncertainty in the oil and gas industry

2021
The estimation of uncertainty is a very important feature of measurement data analysis and management in the oil and gas industry. This document gives...

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Corrosion threats handbook - Upstream oil and gas production

2021
The purpose of this handbook is to provide new starters and non-corrosion specialist personnel working in the oil and gas industry with an introductio...

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External corrosion awareness handbook: A guide for visual recognition of external integrity threats to upstream oil and gas production plant

2021
This handbook provides general information to personnel working across the hydrocarbon industry to help minimise the risks associated with external co...

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HM 71. Oil field produced water metering and analysis, offshore UK waters

2021
The Energy Institute (EI) Hydrocarbon Management Committee is responsible for the production and maintenance of standards and guidelines covering vari...

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