The Pour Over Today - TPO Explains | What is Crude Oil?

Episode Date: March 21, 2026

Readers of The Pour Over pick a topic to have explained, and Jason or Kathleen have to get Joe to understand it in less than 30 minutes… This week, Jason is explaining Crude Oil. Looking to support us? You can choose to pay⁠⁠ ⁠⁠⁠⁠here⁠⁠⁠⁠⁠⁠ Check out our sponsors! We actually use and enjoy every single one. ⁠⁠Cru⁠⁠ ⁠⁠Wild Alaskan⁠⁠ ⁠⁠HelloFresh⁠⁠ ⁠⁠Safe House Project⁠⁠ ⁠⁠QAVA⁠⁠ ⁠⁠CCCU⁠⁠ ⁠⁠Upside⁠⁠ ⁠⁠Mosh⁠⁠ ⁠⁠LMNT⁠⁠ ⁠⁠Bible Gateway Plus⁠⁠ ⁠⁠Life Application Study Bible⁠⁠ ⁠⁠Unto⁠⁠ ⁠⁠Compelled Podcast⁠⁠ ⁠⁠I Choose Love⁠⁠ ⁠⁠TPO Corrections Page⁠

So OPEC is, and I confirmed that people call it this, it is a cartel. Happy St. Patrick's, Joe. Yeah, happy St. Paddy's. Do you have any Irish heritage? Probably more than you. I think a little bit. Hannah has some. I'm profiling you, but I imagine you do not have much Irish heritage.

No, I do not. I do not. So is there anything special that you do? Or Hannah in this case? Hannah made Lucky Charm Rice Krispy Treats with Bryn. So I wouldn't call it a tradition yet, but maybe year one of a tradition. There was a little bit, there was acknowledgement of St. Patrick's Day in our house. Yes, solid. Well, we got a fun one today. And I, so this came about because I saw the phrase crude oil and was like, man, I sort of know what that is. I could probably explain it, but I don't totally know. And I brought that up to the writers and everyone gave kind of the same answer. And it's like, that's exactly what we want to do here on TPO Explains.

We're not going to turn you into an expert because we're not experts, but we can take a shallow dive. And oil comes up in the news all the time, and we can at least make sure you know which way is up. And so that's what we're going to do today, Joe. Talk about crude oil. Let's do it. Oil that is crude. That's right. Mildly or significantly inappropriate oil. Let's dive in. Awesome. Let's do it. All right, Joe, what is crude oil? Got any guesses? Well, jumping off that last point, the fact that it's crude oil, I'm going to take a stab at this.

Is it oil and it's like raw pure form and therefore it's like not fully purified and so it needs to be refined? Yes, yes. So it is a naturally occurring liquid formed that the way it is formed is it is ancient marine life. So, like, algae and plankton that died, sank to the ocean floor and then was buried under sediment, sediment, sediment. And then basically cooked by the heat of the earth and the massive pressure for a really long time. So it is, like, genuinely, like, what it is is, it's, like, ancient sunlight that has been turned into this dark sludge deep underground that we then pull out. out and use for all sorts of things, including, you know, gasoline and stuff that is like, we release that energy.

You know, for all the environmentalists out there that are against, like, oil, if we, if some oil company called it ancient sunlight, do you think that that would get the environmentalists on board? It's just a branding issue, you know? We just need a rebrand from fossil fuels to ancient sunlight. Yeah. Okay. That explanation is fascinating.

I did not know that about crude oil and ancient sunlight. But, okay, it's everywhere. What countries have the most oil? So there are two ways to answer that question. There's oil reserves, which is the amount of oil that's in the ground. And then there's oil production, which is the amount of oil that the country has taken. out of the ground. So when it comes to oil reserves, proven oil reserves, so we know it is there, in first place is Venezuela with 303 billion barrels of oil. And then we have Saudi Arabia, Iran,

Canada, and Iraq. And then in ninth place is the United States. Okay. So the U.S. has 55 billion barrels of oil. But then when it comes to production, U.S. is number one. So the U.S. is producing 13.4 million barrels of oil every day. Saudi Arabia and Russia are tied for second. They're both at like 9.5 and then there's Canada. I was not expecting USA to be at the top of the list for production. Yeah, so it's a relatively new thing that the U.S. is number one. It was part of the Shale Revolution. Okay. So the Shale Revolution was starting in the mid-2000s, American companies perfected two technologies, hydraulic fracturing, which is commonly called fracking, and horizontal drilling. And those allowed them to extract oil and natural.

gas that was locked inside these like dense rock formations that were previously unreachable. So we had had oil crude oil that we couldn't get. And then I mean, fracking is basically you like pressure wash this rock and force it. You you get a little break. You pump a bunch of water into it until it fractures. And then it releases. Then you can get to any oil that's inside. Okay. So we have. all these reserves, we produce all this oil. What comes to mind is, you know, our, our cars, like, what are we using all this oil for? Yeah, literally everything. And this, so this image, I'll talk through it. But explaining the refining process will help then explain what we use it for.

So when you have crude oil, it's basically a, it's like a cocktail of all these different hydrocarbons that, and when you heat them, they evaporate because they're different at different temperatures. So what you do to kind of take it from crude oil to and refine it to all these different things, you heat it in what is called a distillation tower. Okay, so you put crude oil at the bottom and you heat it up to like 400 degrees Celsius or higher. And then as the stuff, most of it then evaporates and goes up this tower. And it gets progressively cooler as you go up the tower. And then as it rises in these different, you know, things than cool, they are collected into trays at these different heights. and you get all these different products. Okay.

So in the tower at the bottom, what basically does not evaporate at all is used as asphalt. And you get, so a barrel of oil is 42 gallons. And from a barrel of crude oil, you're going to get like three gallons of residue, which can be used for asphalt. You're going to get two gallons of lubricating oils, which are used as like motor oil or different greases,

you're going to get 10 gallons of diesel, around four gallons of jet fuel or kerosene, and then the most, which is useful, is gasoline. So you get 19 gallons of the 42 that can be used to, you know, run your car. And then you get two gallons of NAFTA, which is turned into it is like a core ingredient in plastic. So we use that a lot. And then there's at the very top there's like different gases that like are released and stuff.

And we use all of this. So that's part of what's amazing is we're taking this sludge from the ground. And crude oil is actually a whole bunch of different things. and then through the refining process, in my mind, we are getting, you know, gasoline to power the car. And that is the majority of what we're getting, or that's what we're getting most of. But there's all these different things that are used kind of across industries and for all sorts of different purposes. A weird way, you know, we talk about, I mentioned the environmental causes and, you know, we want to be good stewards of the earth. in a weird way what you just showed shows at least when we are taking this crude oil,

we are being good stewards of that resource by not wasting like anything. Yeah. And it is used in all sorts of things. So fuel and anything that's plastic, so that's a lot of products. But then also petroleum byproducts or crude oil byproducts are used in medicine. they're used in fabric, they're used in fertilizer that then is growing food. So it does feel a little bit, you know, like, hey, we've, you know, we've killed the animal, but we're using every part of the animal.

And that at least is good. But it is a very, it is, it is very profit driven. You know, we are also squeezing every ounce of economic value out of crude oil. Oh, yeah, that graphic was super helpful. So yeah, be sure to check out. the video of this on YouTube so you guys can see what what I just saw. Well, Jason, we are going to try a new segment. I'm going to give you some rapid fire oil-related things I've been seeing in the news,

and I would like you to quickly explain that context of what I'm going to throw at you, okay? Yeah, let's do it. Okay, so obviously this hits home. Oil prices are up, gas prices are up, explain. Yes. Okay. So when when the phrase like prices are up or prices are down, that is actually it is referring

to either bent crude or WTI. So because there's oil everywhere and there are lots of companies that are, you know, producing oil or drilling for oil, they've created the world, the economy has created these kind of two benchmarks. So bent crude is crude oil that comes out of the North Sea near, like in between the United Kingdom and Norway. And it's just like a reliable spot to get crude oil. And so, and it's like of a reliable quality. And so they're saying how much is that crude oil going for?

And then similarly, but just picking a different region, WTI is West Texas. Texas intermediate. And so it's kind of the proxy for all oil that is produced in the U.S. And so when they're saying oil prices are up, it's saying specifically oil from one of these two places that we just kind of use as a proxy for oil everywhere. But in reality, there are, there are differences in oil everywhere. And so what you get out of the refining process is slightly different in each place, and that makes, you know, oil of different value depending on where it is. Have you ever opened your Bible and thought, man, I really wish I understood this better?

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Good. OPEC. Yes. So OPEC is, and I confirmed that people call it this, it is a cartel of oil. producing countries, basically together these countries. So OPEC is 12 countries, mostly in the Middle East and Africa, and then Venezuela is a part of it. And then OPEC plus is those countries plus 10 more. And significantly, OPEC plus includes Russia. And so when you talk about OPEC plus, they control over 40% of oil production, of global oil production.

And they openly collude to set prices or say like, hey, we're going to reduce supply. So we're going to control the price and basically control supply and demand, collude to decide how much we're going to produce that impacts the entire market. And it is amazing. Like we talked about all the things that crude oil is used in. But it really quickly impacts the entire global economy because of gasoline and fuel for huge tankers and planes and all this. So it's not just like, hey, I have an aluminum can that has water in it. There's no petroleum crude oil product in that.

But for it to arrive at my door is going to cost more money if crude oil prices go up. And so OPEC Plus has a very legitimate, very large influence on just the entire global economy. And there's not a whole lot of ability to counter what they do. They're obviously incentivized to continue selling oil. But it's kind of remarkable the amount of control they have. Public cartel. And they're just open about it. Yeah. The Strait of Hormuz.

Yes, in the news a lot. So it is a 21 mile, so narrow in terms of ocean. Narrow in terms of the ocean. So it's a choke point that is 21 miles long. And all of the oil that is produced in the Persian Gulf has to go through the Strait of Hormuz to get. to the open ocean. And roughly 20%, at least pre-war, 20% of global oil flowed through this, you know, little stretch of ocean that's in between Iran and Oman. And so basically, Iran can hold the straight hostage because it's on its border by planting mines or attacking oil tankers that go through. And again, it's this, there's this one really critical little spot where if you mess that up, the entire world is going to feel it. Russia, Ukraine War. Yeah. So we were talking

about how Russia is the third largest producer of oil. And part of what happened when they invaded Ukraine is that Western countries led by the U.S. issued all these sanctions forbidding other countries and themselves from buying Russian oil. And so you've you've just removed a lot of supply of oil from the global economy. And that hurts Russia, obviously. It also kind of hurts everyone. And it was just, I didn't fully appreciate like Russia is a huge global player in oil production and saying, hey, we're just going to be done with the second or third largest producer, has significant impacts. Renewable energy. Yes. So there is massive increase in demand and production for renewable energy. And but the problem if you are anti-oil is it is so ingrained in the economy

and there is so much more demand for energy in general that even as more and more, renewable energy comes online, there's still just massive need for oil to be able to meet the global energy demands. And that's especially true in developing countries. Right now, renewable energy is just less economical than burning coal or burning oil. And so developing countries are like, hey, we're not paying a premium for this to be solar. We just need energy to fuel the economy. You did it, Jason. Great job explaining those things.

Very quickly, rapid fire. Some of them were quick. Well, do you have any fun facts? Yes, I do. I'll make Kathleen proud. All right. So we measure oil in barrels, which feels weird. I mentioned earlier, a barrel of oil is 42 gallons.

The term comes from the 1860s Pennsylvania oil boom when workers stored crude oil in old whiskey barrels. And here we are still using that as the denomination. Let's see, what else? Oh, in April 2020, so pandemic, very early pandemic, the entire world has basically shut down. a barrel of oil cost, I want you to guess. How much do you think a barrel oil cost April 2020? Barrel of oil would have cost $60 a barrel. Negative 37.

Traders were literally paying people to take the oil because they had nowhere to store it. Like there's this behemoth of industry that produces tons of. of oil every day, you know, millions of barrels of oil every day. And suddenly, the use of oil cut so dramatically that they filled up the storehouses. And they're like, we, we have nowhere to put the oil and they were paying people to take oil. So for some reference point, in 2024, the average, a barrel of oil averaged $81. In 2025, it averaged about 70. And it, it makes news whenever it goes up over 100, that that feels like very expensive. That's insane.

I think those, those are going to be my two fun facts. Negative oil prices and whiskey barrels. Whiskey barrels. I love it. Those are very fun. Great job. And how about Christian perspectives for this one? Yeah, there, I thought of a few, but especially we've talked a little bit about

renewable energy and stuff. And learning about what crude oil is and how it underpins the global economy was fascinating. And energy policy and politics and production just felt like we barely scratched the service and I saw how complex it could be. And so my Christian perspective is choose humility and saying that someone who cares about creation stewards, and someone who cares about affordable energy for the poor, both have valid biblical instincts. And I think it is so important and useful for both those people and all of us to just hold our stances loosely, be open to new information, and resist the kind of tribal poll to just adopt your party's energy policy and talking points and be open to think,

through the new information and allowing it to let you love others better. Great. Always solid. Choose humility. Well, thanks, everyone, for joining us on another episode of TPO Explains. As a reminder, you can watch this episode on YouTube and Spotify. Make sure to like, comment, and subscribe. We'd love to hear your thoughts and feedback.

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