Fossil Fuels

Petroleum, Coal, and Natural Gas Power Much of the Planet

Oil Derrick
An oil derrick extracts black gold from underground reserves. Getty Images North America

Fossil fuels are non-renewable resources created by the anaerobic decomposition of buried dead organisms. They include petroleum, natural gas, and coal. Fossil fuels serve as the dominant source of energy for humanity, powering over four-fifths of the world's utilities. The location and movement of the various forms of the resource vary dramatically from region to region.


Petroleum is the most-consumed of the fossil fuels.
It is an oily, thick, flammable liquid that is found in geologic formations beneath the Earth's land and oceans. Petroleum can be used in its natural or refined state as fuel or be distilled into gasoline, kerosene, naphtha, benzene, paraffin, asphalt, and other chemical regents.

According to the United States Energy Information Administration (EIA), there are currently over 1,500 billion barrels of proven crude oil reserves in the world (1 barrel = 31.5 U.S. gallons) with a production rate of approximately 90 million barrels a day. More than one-third of that production comes from OPEC (Organization of Petroleum Exporting Countries), an oil cartel consisting of twelve member countries: six in the Middle East, four in Africa, and two in South America. Two of the OPEC countries, Venezuela and Saudi Arabia, has the world's first and second largest reserve of petroleum, with their rank interchanged depending on source.

Despite their large supply, however, it is estimated that the current top producer of petroleum is actually Russia, which maintains a production rate of over ten million barrels of day, according to Forbes, Bloomberg, and Reuters.

Although the United States is the world's top consumer of petroleum (approx 18.5 million barrels a day), most of the country's imports do not come from Russia, Venezuela, or Saudi Arabia.

Instead, America's top oil trading partner is Canada, which sends about three billion barrels of its oil south each day. The strong trade between the two countries is rooted in trade agreements (NAFTA), political affinity, and geographic proximity. The United States is also becoming a top producer and is soon expected to outpace its imports. This projected change is primarily based on the massive reserves coming out of North Dakota and Texas' shale formations. The country is now poised to domestically produce over 8 million barrels a day within the next year or two, leading to more balance international trading, national energy security, and employment for the American people.


Coal is dark combustible rock consisting of primarily carbonized plant matter. According to the World Coal Association (WCA), it is the world's most commonly used resource for electricity generation, contributing to 42% of global needs. After coal is extracted through underground shaft mining or ground level open pit mining, it is often transported, cleaned, pulverized, then burned in large furnaces. The heat generated by coal is often used to boil water, which creates steam. The steam is then used to spin turbines, generating electricity.

The United States has the world's largest coal reserves at approximately 237,300 million tons which is about 27.6% of the global share.

Russia is in second with 157,000 tons, or about 18.2%, and China has the third largest reserves 114,500 tons, or 13.3%. Although the USA has the most coal, it is not the world's top producer, consumer, or exporter. This is primarily due to the cheap cost of natural gas and rising pollution standards. Of the three fossil fuels, coal produces the most CO2 per unit of energy.

Since the early 1980s, China has been the world's largest producer and consumer of coal, extracting over 3,500 million tons annually, which is close to 50% of total world production, and consuming over 4,000 million tons, totaling more than the USA and the entire European Union combined. Almost 80% of the country's electricity generation comes from coal. China's consumption now outpaces its production and as a result they have also become the world's largest importer as well, surpassing Japan in 2012.

China's high demand for the carbon rock is a result of the country's rapid industrialization, but as pollution builds, the country is starting to slowly shift its dependence from coal, opting for cleaner alternatives, such as hydroelectric power. Analysts believe that in the very near future, India, who is also industrializing at an immense pace, will become the world's new top importer of coal.

Another fundamental reason why coal is so popular in Asia is because of geography. The world's top three coal exporters are all in the Eastern Hemisphere. As of 2011, Indonesia has become the world's top exporter of coal, sending about 309 million tons of its steam variety overseas, overtaking longtime top exporter, Australia. However, Australia remains the world's number one exporter of coking coal, a commonly man-made carbonaceous residue derived from low-ash, low-sulfur bituminous coal that is often used for fuel and smelting iron ore. In 2011, Australia exported 140 million tons of coking coal, more than twice as much as the United States, which is the world's second top exporter of coking coal, and ten times more than the world's third overall coal exporter, Russia.

Natural Gas

Natural gas is a highly combustible mixture of methane and other hydrocarbons that is often found in deep underground rock formations and petroleum deposits. It is often used for heating, cooking ,electricity generation, and sometimes to power vehicles. Natural gas is often transported by pipeline or tank trucks while on land, and liquefied to be transported across oceans.

According to the CIA World Factbook, Russia has the world's largest reserve of natural gas at 47 trillion cubic meters, which is about 15 trillion more than second highest, Iran, and almost twice as much as third highest, Qatar. Russia is also the world's top exporter of natural gas and the European Union's leading supplier. According to the European Commission, over 38% of the EU's natural gas is imported from Russia.

Despite Russia's abundance of natural gas, it is not the world's top consumer, it remains second to the United States, which uses over 680 billion cubic meters a year.

The country's elevated consumption rate is the product of its highly industrialized economy, large population, and cheap gas prices brought on by new extraction technologies called hydraulic fracturing, in which water is injected at high pressure into wells to shatter rocks deep underground, helping to release trapped gas. According to the New York Times, natural gas reserves in the United States rose from 1,532 trillion cubic feet in 2006 to 2,074 trillion in 2008.

Recent discoveries particularly in the Bakken Shale formation of North Dakota and Montana accounts for over 616 trillion cubic feet, or a third of the nation's total. Currently, gas only accounts for about a quarter of America's total energy use and about 22% of its electrical production, but the Energy Department estimates that demand for natural gas will rise by 13% by 2030, as the country slowly converts its utilities from coal to this cleaner fossil fuel.