
Where Does Crude Oil Come From?
5 minute read • Last update May 2026

In this article
How is oil formed?
Crude oil, or petroleum, is formed from the ancient buried remains of microscopic marine organisms like plankton and algae through natural processes involving heat and pressure over millions and millions of years. These processes are called called diagenesis and catagenesis.
As ancient plants, bacteria, algae, and other small animals and organisms (or diatoms) that lived in the oceans millions and millions of years ago died, they settled down on the ocean floor.

Over time, as more and more of these ancient creatures died and floated down to the bottom of the ocean, they were buried by layers of sand, silt, and rock.
These layers continued to pile up over millions of years and eventually there’s so much pressure and heat coming from the earth that the remains of the plants and animals were transformed into what we now call crude oil, or petroleum.
Why is crude oil called a fossil fuel?
Crude oil is called a fossil fuel because it’s actually formed from fossils – the diatoms, or ancient plants, bacteria, and algae we mentioned previously. The word “petroleum” actually means “rock oil” or “oil from the earth.”
Does oil come from dinosaur fossils?
No, oil does not come from dinosaur fossils. It’s a commonly spread fiction that oil comes from dinosaurs because when people hear fossils, their brains immediately jump to dinosaurs. However, that’s not the case.
The truth may be less exciting to some, but oil and other fossil fuels are not actually formed from the remains of dinosaurs. The oil we’re drilling and pumping to the surface as fuel is formed from diatoms, small organisms such as algae and bacteria that lived long before dinosaurs even existed.
What are the key stages of oil formation?
The key stages of oil formation are the accumulation of dead microscopic sea creatures like plankton and algae, the burial and compression of those creatures, application of heat and pressure over millions of years that turns the material into kerogen, and finally, additional chemical transformation that turns kerogen into petroleum or crude oil.
Let’s take a closer look at each of these stages.
Stage 1: The death of ancient aquatic creatures
Just like the ocean now, millions of years ago the ocean was full of small creatures called phytoplankton and zooplankton.
- Phytoplankton are microscopic plants that, just like plants that live on land, require access to the sun to survive through the process of photosynthesis (turning sunlight into energy using chlorophyll).
- Zooplankton are microscopic animals that feed upon phytoplankton to survive.
These tiny creatures do not have very long lifespans (a few weeks at most), so they are reproducing and dying at a very rapid rate. When these microscopic creatures die, they sink to the floor of the ocean.
Stage 2: Sedimentation on the ocean floor
Over time, the plankton are buried and mixed underneath layers of sand, silt, and rock. This process has occurred since these creatures evolved over 1 billion years ago and continues to this day.
Stage 3: Increasing heat and pressure
After the remains of the plankton are buried long enough, the layers of sediment are so thick that the weight of the Earth’s crust imposes high pressure forces on the fossils. At the same time, heat rising up from the Earth’s mantle (the layer below the crust) also comes into play.
It’s the combined forces of the pressure and heat that begin to chemically alter the organic matter.
Stage 4: Breaking down through diagenesis
Diagenesis converts the organic matter into a waxy substance called kerogen. This process occurs as a result of the immense pressure inflicted upon the organic matter.
During diagenesis, the organic molecules, such as carbohydrates, proteins, and lipids (fats), break down. This means that atoms that make up the molecules are actually breaking apart from one another.
Stage 5: Further molecular breakdown through catagenesis
The principal stage of oil formation, catagenesis occurs as a result of the high temperatures imposed on the waxy substance kerogen underneath the Earth’s crust.
Kerogen is only transformed into oil at temperatures between 90°C-160°C. Any colder, the transformation does not occur. Any hotter, and the kerogens will transform into natural gas instead. This specific temperature range is referred to as the “oil window.”
The kerogens continue to break down even further from the heat into hydrocarbons. As more hydrocarbons accumulate and mature, oil and natural gas deposits are formed.
How do we get oil from the ground?
After oil is formed, it seeps upwards through the Earth from high to low pressure environments until it hits a layer of rock that it cannot permeate through.
It’s at these locations underground that oil reservoirs are formed. Oil reservoirs are often thousands of feet below the surface.
To extract the oil from the reservoirs, we drill holes or wells, then use a pipe to remove the oil. It is then transported via pipeline, truck, or ship to a refinery.
Where do we drill for oil?
Oil drilling occurs all over the globe. There are significant oil drilling operations in the Americas, the Middle East, and Eurasia.
Locations suitable for drilling have the correct combination of porous, trap-like geological formations underground, economic viability, and government approval to drill. These operations can be onshore or offshore.

Where do we drill for oil in the Americas?
In North America, much of oil drilling occurs in the United States, both onshore and offshore. Drilling occurs in the Permian Basin in West Texas, in the Gulf of Mexico, and in the Bakken Formation in North Dakota.
In South America, drilling is concentrated offshore of Brazil, in the Orinoco Belt of Venezuela, and the Vaca Muerta formation in Argentina.
Where do we drill for oil in the Middle East?
In the Middle East, oil drilling is concentrated mostly in Saudi Arabia, but there are also significant operations in Kuwait, Iran, United Arab Emirates, and Iraq.
Where do we drill for oil in Eurasia?
In Eurasia, drilling operations are located in Kazakhstan, Russia, China, and Azerbaijan.
Is oil still being formed?
Yes, the process that forms crude oil or petroleum is still occurring. It is a naturally reoccurring process.
However, humanity is drilling, pumping, and burning more oil for fuel than the Earth can create. This is why fossil fuels are considered a non-renewable source of energy.
How much oil do we have left?
Are we running out of fossil fuels? Scientists estimate that we have about 4-5 decades of oil remaining before we run out completely. This timeframe factors in our current rate of global consumption and the known oil reserves around the planet.
According to Worldometer, there are 1.7 trillion barrels of proven oil reserves left. Humanity consumes 34 billion barrels of oil annually. This means there are roughly 47 years remaining until our oil reserves are depleted.
We could extend the time further by either finding more oil underneath the Earth or reducing our dependence on crude oil to fuel our society.
Written by Graham Lumley
Graham Lumley, Growth Product Manager at BKV Energy, leads digital and traditional marketing strategies, focusing on educating Texans about the state's deregulated energy market. With over 10 years of marketing experience, he creates content to help consumers understand and save on their energy bills, bringing a fresh and dynamic approach to the industry.
Related articles
Get $50 off your electric bill!
Use code BKVEJOINUS50
Enter your zip code to shop BKV Energy's affordable, fixed-rate Texas electricity plans. Use the promo code for $50 off your electric bill.

