Composition

The proportion of hydrocarbons in the mixture is highly variable and ranges from as much as 97% by weight in the lighter oils to as little as 50% in the heavier oils and bitumens.

The hydrocarbons in crude oil are mostly alkanes, cycloalkanes and various aromatic hydrocarbons while the other organic compounds contain nitrogen, oxygen and sulfur, and trace amounts of metals such as iron, nickel, copper and vanadium. The exact molecular composition varies widely from formation to formation but the proportion of chemical elements vary over fairly narrow limits as follows:

Four different types of hydrocarbon molecules appear in crude oil. The relative percentage of each varies from oil to oil, determining the properties of each oil.

Petroleum is used mostly, by volume, for producing fuel oil and gasoline (petrol), both important "primary energy" sources. 84% by volume of the hydrocarbons present in petroleum is converted into energy-rich fuels (petroleum-based fuels), including gasoline, diesel, jet, heating, and other fuel oils, and liquefied petroleum gas. The lighter grades of crude oil produce the best yields of these products, but as the world's reserves of light and medium oil are depleted, oil refineries are increasingly having to process heavy oil and bitumen, and use more complex and expensive methods to produce the products required. Because heavier crude oils have too much carbon and not enough hydrogen, these processes generally involve removing carbon from or adding hydrogen to the molecules, and using fluid catalytic cracking to convert the longer, more complex molecules in the oil to the shorter, simpler ones in the fuels.

Due to its high energy density, easy transportability and relative abundance, oil has become the world's most important source of energy since the mid-1950s. Petroleum is also the raw material for many chemical products, including pharmaceuticals, solvents, fertilizers, pesticides, and plastics; the 16% not used for energy production is converted into these other materials.

Petroleum is found in porous rock formations in the upper strata of some areas of the Earth's crust. There is also petroleum in oil sands (tar sands). Known reserves of petroleum are typically estimated at around 190 km³ (1.2 trillion (short scale) barrels) without oil sands, or 595 km³ (3.74 trillion barrels) with oil sands. Consumption is currently around per day, or 4.9 km³ per year. Because the energy return over energy invested (EROEI) ratio of oil is constantly falling (due to physical phenomena such as residual oil saturation, and the economic factor of rising marginal extraction costs), recoverable oil reserves are significantly less than total oil-in-place. At current consumption levels, and assuming that oil will be consumed only from reservoirs, known recoverable reserves would be gone around 2039, potentially leading to a global energy crisis. However, there are factors which may extend or reduce this estimate, including the rapidly increasing demand for petroleum in China, India, and other developing nations; new discoveries; energy conservation and use of alternative energy sources; and new economically viable exploitation of non-conventional oil sources.