This website uses cookies to help us improve your user experience and create reports. The cookies collect information in an anonymous form.
Please visit our privacy policy page to learn more about the cookies used on this website and how to change current settings if you do not agree. By continuing to use this website, you consent to the use of cookies.

Oil and natural gas remain the world's leading fuels, accounting for nearly 60% 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?

Workforce stabilisation sets foundation for oil and gas industry’s bright future

Total employment supported by the UK offshore oil and gas sector is now back in line with industry’s long-term trend, according to new research published by Oil and Gas UK (OGUK).OGUK’s 2019 Workforce Report, which provides insight into the employment landscape across the UK oil and gas sector,...

Read more »

Energy Insight: World oil and gas - top ten (DSS01)

Production and ConsumptionThe rankings for oil production and consumption reflect the political and economic situations of the countries concerned as much as their own oil reserves.The USA, with vast reserves of oil and benefiting from a stable, democratic government, was consistently one of the top...

Read more »

Energy insight: Methane emissions reduction – Part 1: Oil and gas

For information on methane emissions related to coal, see Energy Insight - Methane Emissions reduction – Part 2 – Coal Why is methane a problem for the climate?Methane (CH4) is the third most abundant greenhouse gas in the atmosphere (after water vapour and carbon dioxide (CO2)). Any metha...

Read more »

UK oil and gas sector delivers stable environmental performance alongside increased production

The UK offshore oil and gas industry has delivered stable environmental performance whilst the sector has increased production levels, according to a new report published by Oil & Gas UK (OGUK).The 2019 Environment Report, which analyses and interprets data gathered and monitored by the Offshore...

Read more »

Cost of UK oil and gas decommissioning continues to fall

The estimated cost of decommissioning the UKCS’s remaining oil and gas infrastructure is continuing to reduce, according to the Oil and Gas Authority (OGA). The latest analysis in the forthcoming UKCS Decommissioning Cost Estimate 2019 Report shows strong progress towards the shared objective of ind...

Read more »

Events and training

Supply and distribution: organisation, operations and economics - September 2019

This 3-day training course is designed for those who are or will be operating in the Supply & Distribution functions and will provide the background knowledge to allow them to take the right decisions on how to supply the network at the right cost. 

Read more »

NEBOSH International Technical Certificate in Oil and Gas Operational Safety

This NEBOSH International Technical Certificate in Oil & Gas Operational Safety training will provide students with an industry recognised qualification for individuals with safety responsibilities in the oil and gas industry. The course is available as a 5-day classroom course, E-Learning and I...

Read more »

In conversation with Lord Browne FREng HonFEI

Attend to discuss and purchase a signed copy of Lord Browne FREng HonFEI's new book - Make, Think, Imagine: Engineering the Future of Civilisation

Read more »

Providing expert insight into LOGIC’S latest contracts and highlighting the legal and practical risk

In November 2018, Oil & Gas UK subsidiary LOGIC published the 3rd edition of their General Conditions of Contract for Construction.  In December 2018, a new standard contract to assist companies with offshore decommissioning in the UK North Sea was published followed by the 4th Edition of L...

Read more »

IEA's World Energy Investment Report 2019

The International Energy Agency’s annual benchmark for tracking energy investment, World Energy Investment 2019 provides a full picture of today’s capital flows and what they might mean for tomorrow’s energy sector It assesses whether the frameworks and strategi...

Read more »

Technical guidance publications

HM 54. Guidelines for the management of measurement for the upstream oil and gas industry

More companies are electing to employ third parties to manage their legal and commercial measurement obligations and to undertake allocation of individual fields from commingled streams. Therefore the issue of management of measurement is becoming increasingly more important.This second edition high...

Read more »

HM 78. Guidelines for meter selection for the upstream oil and gas industry

This publication has been produced as a high-level guideline on meter selection by those involved in the upstream oil and gas industry. The selection of the correct meter or primary element along with the appropriate secondary instrumentation is fundamental to the performance and/or reliability of a...

Read more »

HM 60. Guidelines for the auditing of measurement systems for oil and gas streams

This publication has been produced as a high level guideline on auditing for use by all of those involved in the measurement process in the upstream oil and gas industry.Measurement system auditing is a critical activity for all operators producing hydrocarbons to ensure financial interests are prot...

Read more »

Guidance for corrosion management in oil and gas production and processing

*This publication has a large file size, please allow extra time for the PDF to download*This second edition of the EI's Guidance on corrosion management in oil and gas production and processing provides general principles and essential engineering guidance and requirements for improving corrosion m...

Read more »

Guidance on managing process safety in decommissioning projects

This publication is intended to provide guidance on managing process safety within decommissioning projects generally within the energy sector, with more specific guidance and information provided, where possible, in the following industry sectors:offshore oil and gas;onshore oil and gas and petroch...

Read more »

Visit our publishing site »

You may also be interested in