How does oil refining work?

Oil refining is an industrial process that transforms crude oil into products such as gasoline, diesel fuel, asphalt, fuel oils, heating oil, kerosene, liquefied petroleum gas, and petroleum naphtha . The process works by exploiting the different physical and chemical properties of the hydrocarbon molecules that make up crude oil, separating them through distillation and then converting them into more valuable products through additional refining processes.

Key Points

- Crude distillation is the first step in processing crude oil into different end products, including gasoline, kerosene, diesel, jet fuel, asphalt, and more

- Fractional distillation separates crude oil components by their size, weight, and boiling point

- Cracking uses heat, pressure, catalysts, and sometimes hydrogen to crack heavy hydrocarbon molecules into lighter ones

• Modern refineries use multiple conversion and treatment processes to maximize the production of high-value products

The total volume of products that refineries produce is greater than the volume of crude oil processed because most products have a lower density than crude oil—an increase called processing gain

Understanding Oil Refining

Crude oil is a complex mixture of hydrocarbons with varying densities and viscosities . The lightest molecules have 1 to 4 carbon atoms, while the heaviest have more than 20, and these molecules are present in varying proportions depending on the deposit, meaning each oil has its own composition and properties .

Essentially every oil refinery first distills crude oil into various fractions in a distillation column, and this first step is referred to as "atmospheric distillation" . Prior to World War II, most petroleum refineries in the United States consisted simply of crude oil distillation units, with some refineries also having vacuum distillation units and thermal cracking units, but all of the many other refining processes were developed during or after the war .

The physical characteristics of crude oil determine how refineries process it, with crude oils classified by density (API gravity) and sulfur content . Refineries can produce high-value products such as gasoline, diesel fuel, and jet fuel from light crude oil with simple distillation, but when refineries use simple distillation on denser crude oils, they produce low-value products, and heavy crude oils require additional, more expensive processing to produce high-value products .

How It Works

The oil refining process involves three main stages: separation, conversion, and treatment.

1. Separation Through Distillation

Crude oil is pretreated through filtration and desalination, then sent to the primary distillation section where it is first fed to a distillation column at atmospheric pressure (Topping) which separates the lighter distillates, whereas the atmospheric residue is transferred to a sub-atmospheric distillation column (Vacuum) which separates the heavy distillates from the vacuum residue .

In a distillation column, crude oil is heated to extremely high temperatures, and as the temperature rises, different hydrocarbon compounds in the crude oil start to vaporize at different temperatures . Heating is usually done with high pressure steam to temperatures of about 1112 degrees Fahrenheit / 600 degrees Celsius .

The lightest fractions, including gasoline and liquefied refinery gases, vaporize and rise to the top of the distillation tower where they condense back to liquids, medium-weight liquids including kerosene and distillates stay in the middle of the distillation tower, and heavier liquids called gas oils separate lower down, with the heaviest fractions settling at the bottom .

2. Conversion Processes

After distillation, heavy, low-value distillation fractions can be processed further into lighter, high-value products such as gasoline, with fractions from the distillation units transformed into streams (intermediate components) that eventually become finished products .

Catalytic Cracking: Fluid catalytic cracking (FCC) upgrades the heavier, higher-boiling fractions from crude oil distillation by converting them into lighter and lower boiling, more valuable products . Catalytic cracking is a cornerstone process in the refining industry, converting heavy hydrocarbons into lighter, more valuable products like gasoline and olefins .

Hydrocracking: Heavy aromatic feedstock is converted into lighter products under very high pressures (70–140 atm) and fairly high temperatures (400–820°C) in the presence of hydrogen and special catalysts, combining catalytic cracking and hydrogenation .

Coking: Coking units apply high amounts of heat and pressure to break down molecules in the heaviest streams into smaller molecules, leaving petroleum coke as a by-product, and products from a coking unit include butanes, naphtha, diesel, and petroleum coke .

3. Treatment and Upgrading

Raw products from distillation and conversion contain impurities like sulfur, nitrogen, and heavy metals, and through processes like hydrotreating and hydrocracking, these unwanted elements are removed .

Catalytic Reforming: Catalytic reforming is a chemical process used to convert naphthas from crude oil into reformates, which are premium blending stocks for high-octane gasoline, converting low-octane linear hydrocarbons into branched alkanes and cyclic naphthenes, which are then partially dehydrogenated to produce high-octane aromatic hydrocarbons .

Desulfurization: The purpose of removing sulfur and creating products such as ultra-low-sulfur diesel is to reduce the sulfur dioxide emissions that result from using those fuels in automotive vehicles, aircraft, railroad locomotives, ships, and other forms of fuel combustion .

4. Blending

Different hydrocarbon streams are blended to create a variety of products, including gasoline, diesel, jet fuel, heating oil, and even materials for plastics and pharmaceuticals .

Why It Matters

Oil refining is fundamental to modern energy systems and the global economy. Oil is the world's most-used energy resource and provides more than 90% of global transportation energy . The refining process enables crude oil—which cannot be used directly in its raw form—to be transformed into the fuels that power transportation, the feedstocks that create plastics and chemicals, and the materials that support infrastructure development.

Complex refineries take advantage of the price differentials that exist between different crude oils due to supply and demand, gravity, quality, and location imbalances . The higher the refinery's complexity index, the more capable it is of processing and converting heavier feedstocks into lighter components , allowing refineries to process less expensive heavy crude oils and still produce high-value products.

Related Terms

• Fractional Distillation: The process by which oil refineries separate crude oil into different, more useful hydrocarbon products based on their relative molecular weights in a distillation tower

• Cracking: A process that breaks down large, complex hydrocarbon molecules into smaller, more valuable ones, and is critical for meeting high demand for lighter products like gasoline and LPG

• Hydrotreating: A process that uses hydrogen to desulfurize naphtha fractions and other distilled fractions from the crude oil distillation unit such as diesel oil

• Refinery Complexity: A measure that quantifies the sophistication and capital intensity of a refinery and has found widespread application in facility classification and cost estimation

Frequently Asked Questions

What products come from oil refining?

Petroleum products include gasoline, distillates such as diesel fuel and heating oil, jet fuel, petrochemical feedstocks, waxes, lubricating oils, and asphalt . Refineries also produce other chemicals, some of which are used in chemical processes to produce plastics and other useful materials, and since petroleum often contains sulfur-containing molecules, elemental sulfur is also often produced as a petroleum product .

Why do refineries need multiple processes beyond distillation?

Very few of the components come out of the fractional distillation column ready for market, and for example, only 40% of distilled crude oil is gasoline; however, gasoline is one of the major products made by oil companies . Additional conversion processes like cracking and reforming are necessary to transform heavy fractions into the lighter, more valuable products that markets demand.

What makes a refinery "complex"?

The primary conversion processes are fluid catalytic cracking (FCC), hydrocracking, and coking, and high-complexity refineries typically produce the highest yields of lighter and higher-value products by application of these technologies . The conventional crude distillation unit is assigned a complexity number of 1.0, and the complexity contribution of each other unit is determined by comparing their capital costs to that of the crude unit .

Last updated: June 11, 2026. For the latest energy news and analysis, visit stakeandpaper.com.