Let's now look at the second major fossil fuel: oil. We saw in the last lesson that oil is a fossil fuel derived primarily from soft organic materials in the ocean like algae, seaweed, and fish, after they die and sink to the bottom, becoming buried in sediment and exposed to heat and pressure beneath the Earth's surface. We can extract oil from deep beneath the surface and refine it into a variety of useful materials that serve us as both energy sources and industrial feedstocks. Back to our Sankey diagram, this time to look at oil. Oil is the most diverse energy source we have. Look at how many pathways it feeds in almost every area of energy supply. Most oil goes towards transportation, but not only gasoline for cars, also diesel for trucking and trains, aviation fuel, and heavy maritime fuels for shipping. In industry, oil and refined oil products provide energy for many different industrial processes. But oil and oil-derived chemicals or petrochemicals are also important feedstocks for production of essential materials, such as synthetic rubber, which is used in tires, and many mechanical products, countless consumer products, drugs, detergents, pesticides, carpeting, insulating materials, paints, and synthetic fabrics are based on petrochemicals. As an energy source for buildings, oil furnaces for space heating are being replaced by natural gas and electricity, but there are enormous gains to be made, particularly in lower income nations in replacing traditional cooking fuels, such as wood or animal dung with less polluting liquefied petroleum gas refined from oil. As we did for coal, let's compare the positives and negatives, the benefits and the costs of using oil. Oil is a critically important energy source in the world today, primarily on transportation, but in a variety of industrial and building applications as well. There's tremendous existing infrastructure for oil production, refining, and consumption. Oil, like coal, is very energy-dense. It packs a lot of energy into small packages so we can ship energy-dense gasoline and diesel fuel to millions of filling stations, and people can drive hundreds of kilometers between fill-ups. Airplanes and ships can cross oceans, and trains can cross continents without refueling. Oil and refined products are easily transported and stored. Pipelines are safest and most efficient as we see here in the Trans-Alaska pipeline, which has been built above ground to avoid impacting the permafrost in this area. Products are readily moved in railcars as well and in tanker trucks in the final stages of transportation to market. Storage tanks hold millions of barrels of crude oil and refined products at refineries, terminals, and transshipment points around the world. Some countries even hold strategic petroleum reserves where oil is pumped into secure sub-surface reservoirs where it can be easily accessed. As for coal, the number 1 negative attribute of oil consumption is greenhouse gas emissions. Burning oil creates carbon dioxide, the greenhouse gas that we're most concerned about, as an agent of accelerating climate change. Thermal oil production injecting steam into heavy oil reservoirs to make the very viscous oil flow more readily, and Bitumen production can also be responsible for GHG emissions if natural gas is burned to produce the steam. The chart shows that while oil emits less CO_2 per unit of energy produced than does coal, the emissions are still very significant. Emissions for bitumen or very heavy oil are higher because of the added energy required to produce it either by thermal oil production or by mining. Concerns about GHG emissions have led some people in high-income nations, particularly in the United States and Canada, which are major oil producers, to attempt to block new oil pipeline construction while less polluting than coal, oil combustion also produces smoke, ash, and toxic gases. Even with technological advances, reducing pollution from vehicles and refineries, it's difficult to reduce noxious gas output. Besides air pollution, there are other pollution and environmental issues associated with oil extraction, including contamination of surface and groundwaters. The negative effects of pollution are well-documented. An air pollution from burning fossil fuels causes many early deaths around the world each year. Oil is a non-renewable resource. Remember, that means there is a finite supply and once it's used, it's gone like at this exhausted oil well. That said, the resources of oil still available around the world are enormous. We have to be careful in our definition of resources, though, because there are several different ways to count them. Fossil fuels are found in sedimentary basins, depressions in the Earth's crust that fill over millions of years with sediments from rivers, lakes, and oceans, including the fossil life that turns into fossil fuels. Some of the major sedimentary basins from which oil and gas have been produced are shown on this map. If we examine all these areas, we can calculate existing resources of literally hundreds of trillions of barrels of oil, which is a lot compared to the 100 million barrels we consume every day. But even our best production technology can extract only a portion of these resources, ranging from about 10 percent to more than 50 percent in a particular oil field. Some oil-prone areas are inaccessible environmentally or politically, or both. Other resources are spread too thinly to be worthwhile trying to recover. So estimates of how much oil we can eventually produce very widely. But it's safe to say that we can't keep producing 100 million barrels of oil per day forever. In fact, we could run short in less than 50 years at our current pace. In addition to all of these issues, world events of the last few years, financial crisis, depressed oil markets, GHG emissions concerns, and the COVID-19 virus have cut deeply into oil exploration worldwide. Big new fields, especially those in challenging environments, take a long time to discover and put into production. This picture shows the producing platform at the giant Hibernia field off the East Coast of Canada, located very close to where the Titanic sank over 100 years ago. Companies started exploring in the area back in the 1960s. The Hibernia discovery well was drilled in 1979, but production didn't begin until almost 20 years later in 1997. Companies have spent much less money on exploration during the last decade, meaning that fewer new oil fields will begin to produce oil in the coming years, making supply scarcer and oil prices more expensive. Until COVID-19 impacted world markets in early 2020, oil demand had been growing steadily for decades. In 2019, the world used about 100 million barrels of oil every single day. That enormous amount of oil requires massive investment and infrastructure around the world just to maintain output, let alone grow it. Especially when you consider that the average mature oil well on land might produce fewer than 50 barrels of oil per day. Even brand new discoveries in new areas might produce only a few thousand barrels of oil per day. COVID-19 reduced average global oil demand in 2020 by more than five million barrels per day. But as the world recovers, the International Energy Agency projects that demand will have returned to 100 million barrels per day by the end of 2022 and grow slowly for years after that. Many technological advances today in oil production, transportation, and use are focused on reducing environmental impacts, particularly GHG emissions. Of particular note, a tremendous amount of work has been done in North America to reduce demand for freshwater to use in fracking and to protect groundwater and surface waters from contamination. There is always natural gas dissolved in oil, and it is usually produced as a byproduct. Historically, some of the gas has been flared or burnt off if it cannot be recovered economically. The graph on the left shows changes in flaring intensity in 2019 versus 2014. In other words, how much gas is flared with each barrel of oil produced. New regulations prohibiting flaring have greatly reduced its intensity in many countries such as Canada, Brazil, and the United Kingdom. On the other hand, oil development in new areas not serviced by gas pipelines has resulted in flaring intensity increases, as in the United States with the expansion of large new shale oil fields. In other countries, the regulatory system has simply fallen apart with government changes, as in Venezuela. The graph on the right shows changes as a percentage in the total amount of gas flared between 2014 and 2019. Strong regulation and good industry practice can be successful. As an example, Canada produce 25 percent more oil in 2019 compared to 2014, but decreased total flaring by 49 percent. On the other hand, the largest increases we're seeing in countries like Syria, Libya, and the United States, where the amount of oil produced was much larger in 2019, but regulations to limit flaring did not keep up the pace. Overall, many countries are succeeding in reducing GHG emissions arising from flaring. Increased awareness of GHG emissions is driving new regulation in other countries, such as the United States, to start trying to reduce their flaring footprint. Many nations have mandated fuel economy standards for most vehicles owned by the public. We must recognize that these advances are taking place largely in higher income countries where technological innovations happen, new regulations can be enforced more easily, and oil producers can absorb some of the costs. As global demand is rising, reducing oil and gas production in North America, Australia, and Europe will result in more of these fuels being produced in countries with lower environmental standards and will consequently raise the global environmental footprint of the industry. To finish off our review of fossil fuels, in the next lesson, we'll look more closely at natural gas.