Oil and natural gas power nearly every part of modern life, from the fuel in your car to the heat in your home to the fertilizer that grows your food. Together, they account for the majority of energy consumed worldwide, but their uses extend well beyond burning fuel. Here’s a breakdown of where these two resources actually go.
Transportation Fuels From Crude Oil
Most crude oil is refined into fuels that move people and goods. Petroleum refineries process crude oil into motor gasoline, diesel (also called distillate fuel oil), jet fuel, and hydrocarbon gas liquids. Gasoline powers the majority of passenger cars and light trucks. Diesel fuels heavy-duty trucks, freight trains, construction equipment, and agricultural machinery. Jet fuel keeps commercial and military aircraft in the air. And bunker fuel, a heavy residual oil, powers the massive cargo ships that carry goods across oceans.
Transportation is the single largest consumer of petroleum products. Even as electric vehicles grow in market share, liquid fuels from crude oil remain the dominant energy source for moving things from one place to another, particularly in freight, aviation, and marine shipping where battery technology hasn’t yet caught up.
Heating Homes and Buildings
About 60% of U.S. homes use natural gas for space heating, water heating, cooking, and clothes drying. If you have a gas furnace, a gas stove, or a tankless water heater, you’re using natural gas directly. Commercial buildings like offices, restaurants, and hospitals also rely on natural gas for heating, and some use combined heat and power systems that generate both electricity and usable heat from a single gas source.
Heating oil, a petroleum product similar to diesel, serves as the primary heating fuel in some regions, particularly in older homes that were built before natural gas pipelines reached their area. Propane, another petroleum-derived fuel, heats homes in rural areas that lack access to natural gas lines.
Electricity Generation
Natural gas is one of the largest sources of electricity in the world. Power plants burn it to spin turbines that generate electricity, and gas-fired plants can ramp up and down quickly, making them especially useful for balancing the grid when demand spikes or when output from wind and solar fluctuates. This flexibility is a major reason utilities have built so many natural gas plants over the past two decades.
The share of electricity that comes from natural gas shifts year to year based on prices, weather, and how much power other sources like renewables, nuclear, and coal are producing. When natural gas prices rise, utilities sometimes switch to coal for cost reasons. When gas is cheap or renewable output drops due to weather (lower wind speeds or drought reducing hydropower), gas plants pick up the slack. Oil plays a much smaller role in electricity generation today, though some island nations and remote areas still use diesel generators as a primary power source.
Raw Materials for Everyday Products
Oil and natural gas aren’t just burned for energy. They serve as feedstocks, meaning raw materials, for manufacturing thousands of products you encounter daily. Petrochemicals derived from crude oil and natural gas are the building blocks of plastics, synthetic rubber, nylon, polyester, adhesives, detergents, and packaging materials. The plastic in your phone case, the polyester in your shirt, and the foam in your mattress all trace back to petroleum or natural gas.
Asphalt, the material that paves roads and parking lots, is a byproduct of oil refining. Lubricants that keep engines and machinery running smoothly come from petroleum. Waxes used in candles, food packaging, and cosmetics are petroleum products. Even the solvents in paint and the compounds in pharmaceuticals often originate from oil or gas processing.
Fertilizer and Food Production
Natural gas plays a critical but often overlooked role in feeding the world. It is the primary raw material for producing ammonia, which is the foundation of nitrogen-based fertilizers. These fertilizers dramatically increase crop yields for wheat, corn, rice, and other staple foods. Natural gas is the most costly component in manufacturing nitrogen fertilizer, which means that when gas prices spike, fertilizer prices follow, and food costs can rise as a result.
Beyond fertilizer, petroleum fuels the diesel engines in tractors, combines, and irrigation pumps. It powers the refrigerated trucks that carry produce from farms to grocery stores. Oil-based products also show up in pesticides, herbicides, and the plastic packaging that keeps food fresh on shelves.
Industrial and Manufacturing Uses
Industry consumes enormous quantities of both oil and natural gas. Factories use natural gas as both a fuel and a feedstock. Steel mills, cement plants, glass manufacturers, and paper mills all burn natural gas to generate the intense heat their processes require. Chemical plants use it as a starting ingredient to produce methanol, hydrogen, and a wide range of industrial chemicals.
Petroleum products show up across industrial operations as well. Refineries produce specialty oils for metalworking, petroleum coke for aluminum smelting, and various solvents used in manufacturing processes. Many industrial facilities also generate their own electricity on-site using natural gas, giving them more control over energy costs and reliability than relying solely on the grid.
Less Obvious Uses
Some uses of oil and natural gas fly under the radar. Compressed natural gas and liquefied natural gas power bus fleets and delivery vehicles in many cities. Natural gas is increasingly used to produce hydrogen, which has applications in fuel cells and refining. Petroleum jelly, a staple in medicine cabinets, is a refined petroleum product. Synthetic fabrics, food-grade waxes, roofing materials, ink, crayons, and even some medications all depend on oil or gas somewhere in their supply chain.
Natural gas also serves as a coolant in some industrial processes and as a pressurizing agent in pipelines. Liquefied petroleum gas (LPG), which includes propane and butane, fuels outdoor grills, portable heaters, and forklifts. In developing countries, LPG has replaced wood and charcoal as a cleaner cooking fuel for millions of households.