You hear about it on the news every day. You use it to transport yourself around town. All of the goods and services in our lives are dependent on it. Wars are fought over it, governments are toppled because of it and gigantic fortunes are amassed from it. But how much do you know about oil aka petroleum?
Pop Quiz Time!
1) A “barrel” of oil is how much?
A – 20 U.S. gallons
B – 42 U.S. gallons
C – 64 U.S. gallons
D – 100 U.S. gallons
2) The name “barrel” of oil came from a real barrel used to ship oil in the 19th century that was based on the old English casks for wine in the size known as:
A – Rundlet
B – Butt
C – Tierce
D – Hogshead
E – Tun
3) How much approximately is 1 metric ton of crude oil?
A – 200 barrels
B – 590 barrels
C – 1012 barrels
D – 2003 barrels
4) What does the adjective “sweet” mean when referring to crude oil?
A – Has a low sulfur content so is easier to refine
B – Has a low viscosity so is easier to refine
C – Has a sweet odor to it due to chemical composition
D – Has a sweet taste to it due to chemical composition
5) Barrels of oil are priced on the markets based on “benchmarks” such as “Brent Crude” or “West Texas Intermediate”. What does this refer to?
A – A term referring to the average molecular composition of the crude oil based on the geographical area in which it was extracted
B – A committee of OPEC scientists who grade oil based on its chemical composition into different grades
C – A scientific committee of the United Nations who grade oil based on its chemical composition into different grades
D – A “scientific” committee organized by the big western oil firms to grade crude oil based on its chemical composition into different grades
6) When you hear on the news about the markets determining the price of crude oil per barrel, where ARE those markets that oil is being traded?
A – Dubai, UAE
B – New York
C – London, UK
D – Hong Kong
7) Approximately what percentage of crude oil is refined to produce fuels such as gasoline, diesel, jet fuel, etc?
A – 20%
B – 52%
C – 84%
D – 95%
8) What was the approximate crude oil production in the United States in 1906?
A – 2,000 barrels
B – 8,000 barrels
C – 57,000 barrels
D – 126 million barrels
9) What is the current approximate crude oil production in the United States today per day?
A – 2,000 barrels
B – 8,000 barrels
C – 57,000 barrels
D – 8 million barrels
10) What is the current per capita consumption of crude oil per year in the United States?
A – 12 barrels
B – 41 barrels
C – 50 barrels
D – 69 barrels
11) What is the current per capita consumption of crude oil per year average for the entire world?
A – 1 barrel
B – 5 barrels
C – 12 barrels
C – 29 barrels
12) The United States consumes how many barrels of oil per day on average?
A – 10,000 barrels
B – 1 million barrels
C – 20 million barrels
D – 50 million barrels
13) Which of the following oil producing nations are not members of OPEC?
A – Saudi Arabia
B – Iran
C – Indonesia
D – Mexico
E – Venezuela
14) True or false – the United States gets most of its imported oil from OPEC nations?
A – True
B – False
15) From which country does the United States import the MOST oil from?
A – Saudi Arabia
B – Venezuela
C – Canada
D – Nigeria
E – Kuwait
16) Which country comes second as being the source of the most imported oil in the United States?
A – UAE (United Arab Emirates)
B – Nigeria
C – Norway
D – Mexico
E – Russia
17) In 2006, the United States did not buy oil from which of the following countries?
A – Albania
B – Australia
C – Belarus
D – China
E – Egypt
F – Germany
G – Jamaica
H – Libya
I – Midway Islands
J – Pakistan
K – Syria
L – Vietnam
18) Approximately how much does it cost to build an oil refinery?
A – 200 million dollars
B – 500 million dollars
C – 1 billion dollars
D – 5 billion dollars
19) When was the last oil refinery built in the United States?
A – 1955
B – 1976
C – 2000
D – 2006
20) For most of the 20th century, where was the world’s largest refinery?
A – Tas Tanura, Saudi Arabia
B – Abadan, Iran
C – Paraguana, Venezuela
D – Ploiesti, Romania
E – Ulsan, South Korea
ANSWERS ANSWERS ANSWERS
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1 – B Exactly 42 gallons, roughly 158 liters based on actual physical barrels used by the Standard Oil company.
2 – C The tierce
3 – B The weight of oil is determined by a number of things including air pressure and elevation and can be calculated here but it is approximately 590 barrels (or 24,000 gallons).
4 – A “Sweet” refers to a lower sulfur content (making it much easier to refine) while conversely “sour” refers to a higher sulfur content. “Light” and “heavy” refer to the relatively viscosity of crude oil.
5 – A – Oil is traded primarily on an assumption that oil from a given region has a given “standard” molecular composition (more here) called a “benchmark”.
Most oil from North America is referred to as “West Texas Intermediate” or WTI and is both “light” and “sweet”.
The other two major benchmarks are “Brent Crude”, referring to oil produced in Europe and the “OPEC basket”, referring to a blend of the various oils produced primarily from Middle Eastern OPEC nations.
GENERALLY speaking, the price of oil per barrel when on the news refers to the price of the Brent Crude benchmark. Although this is not the most voluminous type of oil produced, the other kinds of oil are often priced off of the Brent Crude benchmark at a given variable (for example OPEC basket oil might be automatically priced at 2 dollars more per barrel off whatever the established price for Brent Crude is).
6 – B and C – For more information see here. Crude oil is the world’s most actively traded commodity, with the vast majority of this done in London and in New York, which is where the prices per barrel are established that you see on the news.
That being said, a lot of oil that’s consumed worldwide comes from fixed price contracts between countries and oil firms and other manners which don’t involve actual participation in the commodities markets.
7 – C – Roughly 84% of refined petroleum products are sources of energy, whether gasoline, jet fuel, diesel, etc. The remaining 16% are primarily used for fertilizers as well as pharmaceuticals, pesticides, plastics and even some weird stuff like waxes used on frozen food packages.
8 – D – Even 100 years ago, the United States was producing a lot of oil, some 126 million barrels, although in those days the primary purpose was to produce kerosene for heating and for lighting. Other byproducts such as gasoline were considered a “waste” product and dumped, sometimes directly into nearby rivers.
9 – D – Over 8 million barrels, information here.
10 – D – Per person, per year, every person in the United States consumes (or perhaps causes to be consumed) about 69 barrels of crude oil per year (2,900 gallons).
11 – C – On average, the world consumes 12 barrels of crude oil per year per person, making worldwide consumption on the order of 72 billion barrels or 3 trillion gallons per year.
12 – C – The United States as a whole consumes 20 million barrels a day, which at a price of $50 would be an expenditure of 1 billion dollars a day.
Interestingly enough, roughly 8 of the 20 million barrels consumed in the United States is extracted domestically.
Second on the list of oil consumers is China, which consumes just over 7 million barrels a day (with a population of over 1 billion people). Full list here.
13 – D Mexico is not and has never been a member of OPEC although it has been invited to join. The current members of OPEC are:
Algeria, Angola, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudia Arabia, UAE Venezuela and Ecuador.
The first five members were Venezuela, Iran, Iraq, Kuwait and Saudi Arabia and began in 1960.
Little known is that the United States was a member of OPEC in 2003 and 2004 when the Coalition Provisional Authority was the official government of Iraq.
14 – B – False. The United States imports about 2 billion barrels annually from OPEC nations and about 3 billion from non-OPEC nations.
That being said, about 1 billion (of the 5 billion being imported annually) come from Saudi Arabia and Venezuela (about half a billion each).
15 – C – The single largest exporter of oil to the United States is Canada at some 850 million barrels annually.
16 – D – Second on the list is Mexico at 623 million barrels annually.
Respectively, this would make Saudi Arabia third and Venezuela fourth but shows that the majority of United States oil imports come from its two neighbors.
17 – A – From the list, only Albania did not export any oil to the United States in 2006 although it did in 2005.
The United States imports oil from hundreds of countries, including tiny nations like the Bahamas, Congo (Brazzaville) and odd places like Bulgaria, Costa Rica and Hungary.
For the complete list, see here.
Notably absent from that list is Iran, one of the largest oil producing nations on the planet.
18 – D – It costs approximately 5 billion dollars to build an oil refinery because they are gigantic, complicated and sophisticated industrial plants.
19 – B – The last oil refinery built in the United States was in 1976 in Garyville, Louisiana. This is for a variety of reasons including expense as well as stringent environmental protection requirements. That being said, a number of existing oil refineries in the U.S. have been upgraded, expanded and/or modernized since 1976.
20 – B – The Anglo-Persian Oil Company built the first refinery in Abadan, Iran in 1913 and kept expanding it until in 1938 it was the largest oil refinery in the world, employing over 220,000 people.
In 1980 during the Iran-Iraq war, the Abadan refinery was heavily shelled by Iraqi forces and was largely destroyed. Due to international sanctions, it took almost 20 years to restore its capacity to pre-war levels.
Currently the largest oil refinery in the world is operated by PDVSA (Venezuela’s state-run oil company) in Paraguana. Second on the list is the Ulsan refinery in South Korea.
Ploiesti, Romania was the home to the world’s first large, modern refinery and played a pivotal role in World War 2 as it was fought over by Nazi and Allied forces.
How’d you do?
