The formation of oil The organic formation theory.

Although, there are arguments regarding the method by which oil formed, the most widespread theory is that that the hydrocarbons were formed from plant and animal material settled on ancient ocean floors bye anoxic decomposition.

According to this theory, oil was formed from plankton and other small living things. When those animals and plants died, they sunk to the ocean bottoms and were covered bye sand and other solid materials. The passage of time resulted in further sinking and accumulation of material on the top of the decomposing mass, at the same time the sand and other inorganic material covering the organic stratum underwent densification and stone formation. This geological process, commensurate with the bacterial and other decomposition processes started to convert the dead plant and animal material to hydrocarbons including oil and natural gas. Under the geological pressure both upward migration and consolidation of these materials occurred. Part of the formed hydrocarbons escaped to the ocean surface, while part of it got trapped in the geologic strata. The formed materials filled the pores in the formed rock, somewhat like water fills a sponge. Subsequent geological distortion of the original mineral strata, resulted in larger accumulation of hydrocarbons and other materials where density segregation took place, salt and/or water in the bottom section and above it oil and of sufficient gas remained trapped then natural gas caps formed above the oil. The geologist called the resulting oil fraction “crude oil” or “mineral oil”. In recent time, oil exploration is taking place primarily under oceans or in mineral strata once covered by ancient oceans. However, due to possibility of underground migration of both the oil but particularly the natural gas, it is often difficult to exactly determine where these hydrocarbons currently reside.
The economically significant oil and natural gas repositories are considered to have been formed in the Tertiary period approximately 66 million years ago.

The theory of the inorganic origin.

Some scientists look questionably on the organic origin theory, which was established by Lomonosov about 250 years ago, and developed an alternative theory, which not only questions the organic origin of oil, but would affect the current estimates of unexploited hydrocarbon reserves also.

The inorganic origin theory assumes that the hydrocarbons were not generated from organic matter decomposition, but were formed from inorganic constituents and great pressures and temperatures and at great depth. This theory was proposed by Russian and Ukrainian scientists  in the 50s and 60s of the last century, and even in the West, the theory has some followers.

The Russian and Ukrainian proponents of the inorganic theory claim that the organic formation would require geologic pressures higher than the pressures postulated achievable at the current depth of the oil reservoirs. Additionally, they claim that bye settling of organic matter the known magnitude of the oil fields could not be achieved.

Lately, this theory gained some support in the West also. Thomas Gold a retired astronomy professor at Cornell University, one of scientists who developed the theory of neutron stars, postulates that during the development of the Earth hydrogen and coal generated the liquid and gaseous hydrocarbons, which migrated higher to their current depths. According to Gold, the organic composition in the oil is explainable by the metabolism of bacterium under extreme conditions. The proponents of the inorganic theory also point out that several phenomena can not be explained by the organic theory, i.e. the frequent presence of helium in natural gas.

If this inorganic theory of oil generation cab be proven, then it would significantly impact the estimates of unexplored oil reserves also. However, most oil geologists reject the inorganic formation theory.