Oil is found in the Earth's crust, which is the outer layer, or skin, of the Earth, 50 to 60 kilometres thick under the continents and only 1 to 5 kilometres thick under the ocean. As it comes out of the ground, oil is a thick liquid, brown or greenish-black in colour, and in that state is called "crude" oil.
Oil was formed from the remains of tiny sea animals and plants that lived millions of years ago in the oceans. As they died they were covered by layers of sediment, then went through a slow chemical change to become oil. This oil seeped through porous layers of rock and gathered in pools where the rock was not porous.
Oil wells are holes drilled down into these oil pools, allowing the oil to rise to the surface.
Deposits of natural gas are often found near oil too.
Oil is very often transported long distances to oil refineries by large ships known as "tankers" for processing.