| With all the publicity nowadays surrounding the price | | | | extraction of oil agitates the encompassing marine |
| of Crude Oil, I resolved to write an enlightening article | | | | environment. Exploration could call for dredging, which |
| on the backdrop of the so-called "Black Gold." I'll | | | | stirs up the sea bottom, stamping out the ocean |
| briefly go over history, environmental effects, pricing | | | | plants that nautical creatures need to survive. Not to |
| and the future of the thick black sludge that is | | | | mention the typical Crude Oil and refined fuel spills |
| coveted by every major economy in the world. | | | | from tanker ship accidents. All of these factors have |
| Hopefully you can reach a better point of view on | | | | tainted frail ecosystems all over the world.Petroleum |
| the subject.The history of Crude Oil is too immense | | | | products are priced like most commodities: supply and |
| to discuss in this brief editorial so I will limit it to a | | | | demand. While this may sound simple, the actual start |
| general overview. The first oil wells were drilled in | | | | to finish process can be a lot more complex subject. |
| China in the 4th century. They where as much as | | | | References to oil prices are generally related to the |
| 243 meters deep and were drilled utilizing drill bits | | | | spot price of either WTI/Light Crude as traded on |
| attached to bamboo poles. The contemporary history | | | | New York Mercantile Exchange (NYMEX). Priced by |
| of crude began in 1846, with the breakthrough of the | | | | the barrel, Crude Oil is rapidly becoming the most |
| process of refining kerosene from coal by Atlantic | | | | costly commodity on the market (second only to |
| Canada's Abraham Pineo Gesner. The first rock oil | | | | Gold).Oil pricing is extremely reliant on both its grade |
| mine was built in Bobrka, Poland the following year. | | | | and location. The vast majority of oil will not be |
| These breakthroughs rapidly spread around the | | | | traded on an exchange but on an over-the-counter |
| world, and Meerzoeff built the first Russian refinery in | | | | basis, typically with reference to a standard crude oil |
| the mature oil fields at Baku in 1861.James Miller | | | | grade that is quoted via a pricing agency such as |
| Williams in Oil Springs, Ontario, Canada in 1858, | | | | Argus Media Ltd or Platts. It is often claimed that |
| excavated the first commercial oil well drilled in North | | | | OPEC arranges the oil price and the real monetary |
| America. The American petroleum industry | | | | value of a barrel of oil is in the area of $2, which is |
| commenced with Edwin Drake's discovery of oil in | | | | equivalent to the cost of extraction of a barrel in the |
| 1859, near Titusville, Pennsylvania. The industry | | | | Middle East. These appraisals of costs disregard the |
| matured slowly in the 1800s, driven by the demand | | | | cost of finding and developing oil reserves.You can't |
| for kerosene and oil lamps. It became a major | | | | talk about the future of oil without talking about the |
| national business in the early part of the 20th | | | | "Hubbert Peak" oil theory. This hypothesis depicts the |
| century. With the introduction of the internal | | | | long-term rate of production of conventional oil and |
| combustion engine came a need that has largely | | | | other fuels. It assumes that oil reserves are not |
| sustained the industry to this day.While we all need | | | | replenishable. It also predicts that future world oil |
| to get to work in some way or another, rarely does | | | | production must unavoidably reach a crest and then |
| anyone consider the environmental effects of the | | | | decline as these reserves are exhausted. Like every |
| fuel that powers our mode of transportation. Yes we | | | | other theory of any importance it is highly |
| know that the emissions from are cars, buses and | | | | controversial. "When will the Oil actually start to run |
| trains have a green house effect on our delicate | | | | out?" is the big question.No matter how you look at |
| environment; but what about the rest of our | | | | it, our society needs to concentrate more efforts on |
| ecology?Oil extraction is costly and occasionally | | | | either alternative fuels or more fuel-efficient modes |
| environmentally detrimental, although Dr. John Hunt | | | | of transportation. While I'm sure that the oil won't |
| from the Woods Hole Oceanographic Institution | | | | peter out in my life time I would like to think we can |
| revealed in a 1981 paper that over 70% of the | | | | leave this world a better place for future |
| reserves in the world are associated with visible | | | | generations.In closing, I hope this article has given |
| macroseepages, and numerous oil fields are found | | | | you a better understanding of the topic and made |
| due to natural leaks. Offshore exploration and | | | | you a more informed consumer. |