Oil and Gas

Oil and Gas


The oil and gas industry developed over the last 200 years to meet an ever-increasing need for fuel. The primary market for oil is transportation energy (fuel for cars, planes, and ships). Natural gas is primarily used for heating, cooking, and increasingly for generating electricity.

Companies in the oil and gas industry discover reserves of these resources in the ground or at sea; build, operate, and maintain the wells or rigs that extract these resources; refine them for use; and then distribute or sell them to retailers, utility companies, or end users. According to the U.S. Energy Information Administration (EIA), petroleum is the largest energy source in the U.S. In 2018, U.S. petroleum consumption averaged about 21 million barrels per day, including more than 1 million barrels per day of biofuels. Much of the U.S. petroleum that was consumed (nearly 70 percent) was used for transportation, including airplane, automobile, bus, ship, and truck fuel. Industrial uses accounted for about 25 percent. Household and commercial use accounted for about 5 percent, largely for heating. About 1 percent was used in the production of electrical power.

The EIA estimates that the United States has approximately 43.8 billion barrels of oil reserves, and 504.5 trillion cubic feet (Tcf) of technically recoverable natural gas in the United States. Estimates for this have risen steadily for several years since new technologies have enabled access to resources that remained out of reach in the past.

At the same time, oil and natural gas companies have looked to previously unexplored regions and locations of oil and gas reserves. As a result, the oil industry in recent years began a more aggressive offshore drilling program and was able to locate and extract large reserves of oil. Also, scientists developed a method for extracting oil and gas from rock formations. Called fracturing, or fracking, this method injects water and a small percentage of chemicals un...