Where Does Crude Oil Come From?

crude oil

Crude oil has many applications in day-to-day life that often goes taken for granted. Even if we understand the basics of how oil is produced, distributed, and used, many people don’t know exactly where it comes from.

Of course, the oil that you might use to heat your home could have come from anywhere in the world, including the State you live in. In this article, we will discuss some of the largest oil producers and where oil comes from.

Who Produces The Most Oil in The United States?

The answer to that question is undoubtedly Texas.

Texas is the nation’s largest oil producer, despite the majority of national headlines about controversial pipelines being nowhere near Texas. Texas produces up to 41% of the nation’s crude oil.

About 69% of the nation’s crude oil production comes from just 5 states:

  • Texas
  • North Dakota
  • New Mexico
  • Oklahoma
  • Colorado

Although these top five states produce the great majority of the oil that comes from the U.S., in fact, 32 different states produce crude oil! Additionally, approximately 15% of the nation’s crude oil is produced offshore in the Gulf of Mexico.

Who Produces The Most Oil in The World?

Interestingly enough, the United States is the world’s biggest crude oil producer. Russian and Saudi Arabia trail closely behind.

  • United States: 15%
  • Russia: 13%
  • Saudi Arabia: 12%
  • Iraq: 6%
  • Canada: 5%

The world market of oil production is complex. Many governments and private companies play roles in the production and distribution of crude oil from its natural location all the way to your home.

What Companies Are Involved in Oil Production?

Essentially, there are two types of oil production companies:

  • International Oil Companies (IOCs)
  • National Oil Companies (NOCs)

An international oil company, or IOC, such as ExxonMobile, Royal Dutch Shell, and British Petroleum, are investor-owned companies primarily concerned with increasing value and profits for shareholders.

NOCs operate as an extension of the federal government where they are based. These include companies such as Pemex in Mexico and CNPC of China. These companies’ primary goal is to financially support their home country and seek its interests.

For more information check out our article: From Liquid Gold to Chess Pawn.

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