You know this oil stuff is so important because petroleum is the lifeblood of the world economy and our modern wonderful technological 21st century world is so heavily reliant on it as the primary source of energy to live this great life. I think we should probably talk about petroleum in a bit more detail before we get to the nuts and bolts of where it's at within the region and how it affects things. So let's do a quick intro to petro. [laughs] Petroleum. We all take it for granted. We're like, "Oh, it's oil. Yeah, I got it. I put in my gas tank. Oh wait a minute, that's gasoline. That's different." So what is this stuff petroleum is a naturally occurring yellowish to brownish to blackish liquid found in geological formations beneath the surface of the Earth. Sounds technical. I guess it is. It's a non-renewable fossil fuel which means it's finite. There's only so much of these fossil fuels inside of Mother Earth and we ain't making no more. It is what it is. What are the other fossil fuels besides petroleum natural gas and coal? Okay. Petroleum is commonly refined into various types of fuels primarily used to produce fuels and I'm really only gonna chat about petroleum right now, not even the other fossil fuels. So natural gas and coal, that stuff's all over planet Earth and it affects things as well, but petroleum, oil is the most important. Now it can be defined in several ways within the industry. It can be... oil can be light or heavy or sweet or sour yeah, seriously. I couldn't make this stuff up.A light sweet oil? Yeah, that's actually the best. So light versus heavy petroleum or crude means that a light oil is a lighter in density, lower density, lower viscosity. Actually kind of runs freely at room temperature, so you crack open some motor oil I guess, that's low enough viscosity just to pour at room temperature. Heavy oil it's like thicker, like maple syrup. It's a higher density, and maybe more sludge-like at room temperature. So light or heavy. Sweet or sour, what's that? It's amount of sulfur that's actually contained in the oil naturally. A very clean morsel for free petroleum is referred to as sweet, and that's because it's sweet. You don't have to clean it up as much. You have to process it as much, you have to put as much money in it to clean it up to get it to another form that's easier to use. Obviously then sour oil is higher sulfur content. Maybe some other stuff mixed in. So light, heavy, sweet, sour, it's all one big petroleum hodgepodge of fun. Now back to the technical part. Oil is refined and separated most easily by distillation, just heating it up and pull at different temperatures, different elements of it will come out that you want into a large number of consumer products that you take for granted. In fact I'm amazed how many people don't understand how much petroleum is in virtually everything they touch in a day's work, or life. You think of it as fuel and yes petroleum is mostly made into gasoline, petrol if you're European. Kerosene, butane, jet fuel, diesel fuel, to things like motor oil, and that's not a fuel anymore, it's a lubricant. You put gasoline in your tank to make it go, it converts it into energy, but then you use oil motor oil as a lubricant to lubricate the inside of the engine. We use petroleum to make asphalt, pesticides, chemical reagents that are used to make all sorts of pharmaceuticals and plastics. You do know that plastics are petroleum-based, right? Like all plastics, like everyone you've ever seen. Plastics petroleum-based and pharmaceuticals too. Petroleum's in everything from cosmetics to KY jelly to Vaseline, aka petroleum jelly. It's even in waxy products like chapstick, stuff you put on your lips. That's petroleum. About 90 percent of vehicular fuel needs are met by oil. So 90 percent of every car and every moped and every golf cart ever created yes, 10% of something else, 90% are fueled by oil. Gasoline goes in the tank. Planes trains, and automobiles, virtually all means of movement that humans have created in the last hundred years rely primarily on petroleum to get that energy powering the vast array of vehicles, and it's also the base of any industrial chemicals. Again, I went back to like of pesticides and herbicides and all sorts of heebie-jeebie stuff. There was really an explosion the stuff in the fifties with Dow Chemical and a whole bunch of other chemical companies that were looking at oil going, "Wow you can make oil into a million different things." And you really can. It's the one commodity that's really the basis of modern industrialized civilization itself. The basis of modern industrialized civilization itself. It's an integral part of daily life now. Let's back it up though just to look at the primary function which is energy. For energy alone, oil accounts for a huge percentage of the world's consumption ranging from lows of say 30-35 percent for Europe and countries in Asia up to say 50 or 55 percent of the energy needs in a common Middle Eastern country. South America, Central America probably 40-45 percent, Africa about 40 percent North America about 40 percent, that's 40 percent of all the energy used for everything not just automobiles, but all the energy, all the electricity, 40 percent of it just based on petroleum. 40 percent of total energy consumption in the United States on a daily basis. It is estimated, guesstimated that the world consumes about 90 million barrels of petroleum every day 90 million barrels of petroleum a day. Well, what's a barrel? This big? Roll out the barrel, it's all a barrel of fun. This is more of an exact measure. A barrel is 42 US gallons. You go buy a gallon of milk at the store, 42 of those goes into one barrel. For our European friends and everyone else on Planet Earth that uses the metric system, that's 159 liters. 40 US gallons, 159 liters. So 3.78 billion gallons a day. 3.78 billion gallons a day. Wowzers, that's a lot of oil and it's every day, day in, day out, around the calendar, around the clock. It fuels and moves human society, period. Okay, you've made the point that it's pretty critical, something you probably already inherently understood. Who's producing all this stuff? Who's using all this stuff? Who has got all this stuff? Who are the major exporters of this stuff? Who are the major importers of this stuff? All of these terms are related to petroleum in some way, but they radically shape the world economy and maybe even cultures and politics and possibly even wars. In other words, where is this stuff at and where does it move to? Because looking at oil with a geographic eye will suddenly help you understand all sorts of little things about many of the industry and economy and war and peace and politics and plights and problems of our modern 21st century, many of which are petroleum influenced. So let's look deeper now into the where of petroleum and bring it all back to the Middle East by the end of this.