Your Practice. Popular Courses. Table of Contents Expand. What Is Petroleum? Understanding Petroleum. Types of Petroleum. Pros and Cons of Petroleum. How Is Petroleum Formed? What Is Petroleum Used For? Is Petroleum Toxic to Humans? Is Petroleum Renewable? What Are Alternatives to Petroleum? The Bottom Line. Petroleum is used as fuel to power vehicles, heating units, and machines, and can be converted into plastics and other materials.
The extraction and processing of petroleum, and thus, its availability, is a major driver of the world's economy and global politics. Petroleum is a finite product that was created over millions of years. Once it is used up there will be no way to replace it.
Due to the harmful effects and limited supply of petroleum, other energy sources are becoming prominent, such as solar and wind. Cons Carbon emissions are toxic to the environment. Transportation can damage the environment. Extraction process is harmful to the environment. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.
We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy.
Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. A nonrenewable resource is a natural substance that is not replenished with the speed at which it is consumed.
Its supply is finite. What Is Shale Oil? Shale oil is a type of oil found in shale rock formations that must be hydraulically fractured to extract.
Read about the pros and cons of shale oil. Green Tech Definition Green tech is a type of technology that is considered environmentally-friendly based on its production process or supply chain. What Is a Renewable Resource? A renewable resource is a substance of economic value that can be replaced or replenished in less time than it takes to draw the supply down. Hydrocarbon A hydrocarbon is an organic chemical compound composed of hydrogen and carbon atoms. Discover why hydrocarbons are important to the modern economy.
What Is Upstream? Upstream refers to the exploration and production stages in the oil and gas industry. In , consumption of finished motor gasoline averaged about 8. Distillate fuel oil is the second most-consumed petroleum product in the United States. Distillate fuel oil includes diesel fuel and heating oil. Diesel fuel is used in the diesel engines of heavy construction equipment, trucks, buses, tractors, boats, trains, some automobiles, and electricity generators.
Heating oil, also called fuel oil, is used in boilers and furnaces for heating homes and buildings, for industrial heating, and for producing electricity in power plants. Total distillate fuel oil consumption in averaged about 3. Hydrocarbon gas liquids HGLs , the third most-used category of petroleum in the United States, include propane, ethane, butane, and other HGLs that are produced at natural gas processing plants and oil refineries.
HGLs have many uses. Total consumption of HGLs in averaged about 3. Jet fuel is the fourth most-used petroleum product in the United States. Jet fuel consumption averaged about 1. Note: Sum of individual products may not equal total because of independent rounding. Source: U. The U. The volume of total transportation sector liquid fuels consumption is projected to be about the same in as in Oil and petroleum products explained Use of oil.
What is energy? Units and calculators. Use of energy. Energy and the environment. Also in What is energy? Forms of energy Sources of energy Laws of energy. Also in Units and calculators explained Units and calculators Energy conversion calculators British thermal units Btu Degree days. The five models used most often are:. Each mathematical model is time-dependent, and some models work better at one time than another.
Since no one model alone offers a reliably accurate prediction, economists often use a weighted combination of them all to get the most accurate answer. In , for instance, the European Central Bank ECB used a four-model combination to predict the course of oil prices to generate a more accurate forecast.
There have been times, however, when the ECB has used fewer or more models to capture the best results. Even so, unforeseen factors like natural disasters, political events, or social upheavals can derail the most careful of calculations. Because crude oil prices are constantly changing and are typically more volatile than stock or currency prices, it is crucial for successful investors and traders to have good information sources that report about the many factors that can influence oil prices.
There are many websites that report crude oil news, but only a few broadcast the breaking news and current prices. The following three offer current information. To an investor, crude oil can be a speculative asset, a portfolio diversifier, or a hedge against related positions. There are two ways to invest in crude oil: futures contracts and spot contracts. Most commodity contracts that are bought and sold on the spot markets take effect immediately - money is exchanged, and the purchaser accepts delivery of the goods.
A futures contract is an agreement to buy or sell a certain number of barrels of oil at a predetermined price, on a predetermined date. MarketWatch provides current oil price information, stories detailing oil's price path—including pre-market and closing bell commentary—and multiple feature articles.
The site has an active link on its landing page showing the price of WTI. Reuters news service has a commodity-specific portion of its website that releases breaking oil news, background stories, and current prices.
During U. American Chemical Society. S, Energy Information Administration. Organization of the Petroleum Exporting Countries. American Enterprise Institute. Energy Information Administration. National Oceanic and Atmospheric Administration. Missouri Department of Natural Resources. CME Group. Intercontinental Exchange. Inetrnational Monetary Fund. Accessed August 11, Federal Reserve Bank of San Francisco. Federal Reserve Bank of St. European Central Bank. Energy Trading.
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