Crude oil is a naturally occurring petroleum product that can be refined for use in a wide variety of materials, such as gasoline, plastics, pharmaceuticals and other chemicals. Oil is a fossil fuel that occurs when dead organisms are heated and pressurised within the earth's surface and subsequently liquidised, absorbing impurities like sulfur from the ground, a process that takes millions of years. Oil is generally sold in barrels, which contain 42 US gallons. The world consumes more than 34 billion barrels of oil a year.
Oil reserves are locations of proven, recoverable oil. Though extraction of oil from wells, fields and sand may differ in method, but reserves include potentially extracted oil. Currently, there is an estimated 1, 490 billion barrels of oil in reserve globally, across 80 countries:
|Country||Global Reserves (billions of barrels)|
|United Arab Emirates||97.8|
Price of Oil
Pricing systems for oil have shifted over the years. Generally, benchmark crude is used to determine prices because crude oil come in many varieties and qualities, often referred to by color, light or dark, or by its sulpher content, sweet or sour.
The primary benchmarks for crude oil come from the West Texas Intermediate (WTI), Brent Bland and Dubai Crude. Around the world, Brent Bland is commonly used—pricing two-thirds of the world's oil. Dubai prices most of the oil in Persian Gulf territories. WTI is the common US benchmark. OPEC (Organisation of Petroleum Exporting Countries) prices an oil basket based on oils from multiple countries in its organisation.
Oil futures can be purchased through exchanges, which buy and sell on current market price with delivery a month later.
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Retrieved 05 Mar 2015 http://www.iea.org/aboutus/faqs/oil/
Retrieved 05 Mar 2015 http://www.opec.org/opec_web/en/data_graphs/330.htm
Retrieved 05 Mar 2015 http://news.bbc.co.uk/2/hi/business/904748.stm