The oil and gas industry has many units exclusively used to measure oil and gas production and import/export. As the US uses the Imperial System, the units used in its oil and gas industry differ from those used outside the US.
In this article, we’ll talk about the most common unit of volume used for oil: BBL. It’s an abbreviation that also serves as the basis for several other units such as MMBBLS or BPD.
What is BBL in Oil and Gas?
BBL is the abbreviation for oil barrel, the unit used in the US for crude oil. One BBL is equal to 42 US gallons or 35 Imperial gallons. It’s equivalent to 159 liters.
It is the unit of volume used to measure oil production in oil fields. It’s also used for importing and exporting crude oil in the US and several other oil-producing countries in the Middle East. American oil companies listed on stock exchanges in the US also report their production is BBL.
More accurately, a standard oil barrel equals 42 US gallons at a standard pressure of 14.696 pounds per square inch and a temperature of 60 °F. So one BBL isn’t just a measure of volume used for oil but a measure of volume under specific conditions. In other words, oil’s volume can change under different conditions.
Oil Barrel History
To understand BBL meaning oil and gas, it helps to look at the history of the unit. When oil production began in Pennsylvania in the late 1850s, there was no standard unit for crude oil.
At the time, barrels were used to transport fluids like beer, whiskey, and molasses. However, the barrels used for these different fluids had different sizes. So oil companies adopted barrels for transporting oil. At the time, various sizes of barrels were used, including 42 US gallons and 45 US gallons (used commonly for whiskey).
During the next decade, the 40 US gallon barrel typically used for whiskey became the default size/volume for oil barrels. In 1866, the oil producers in Pennsylvania adopted the 40 US gallon barrel as the standard unit of volume for crude oil. The reason behind this step was to ensure there was no confusion or miscalculation in the oil trade.
By 1882, the standard unit was updated to 42 US gallons and officially adopted across the novice oil industry in the US. All major private and government agencies within the oil industry standardized this unit.
It’s unclear when exactly BBL became an abbreviation for oil barrel. There is a myth in the oil industry that BBL stands for blue barrels, as blue painted barrels were used for transporting crude oil.
While it is true that the initially standardized oil barrels made of wood were painted blue, the use of the abbreviation BBL predates oil production. So it’s safe to say that it wasn’t the blue barrels of oil that resulted in the abbreviation BBL for crude oil barrels.
Is Oil Transported in Actual Barrels?
While oil barrel or BBL is frequently used in the oil and gas industry worldwide and not just in the US, crude oil isn’t transported in actual barrels (drums) anymore, at least not extensively. Initially, the oil used to be transported in barrels, which is why we have BBL as a standardized unit. However, today, oil is transported through pipelines and tankers.
So why is BBL still used in the oil industry? Well, BBL has become more of an economic concept at this point. Even though oil cargo doesn’t make up of hundreds or thousands of barrels, it’s still measured in BBL.
Companies still use BBL to measure their production and sell the oil. Even the huge tankers that carry crude oil over waters and on roads use BBL as the unit for the oil. However, the use of actual barrels is becoming more and more obsolete.
There are several reasons behind this shift as there are more efficient and modern ways of moving oil. Steel drums that became the common container for crude oil in the 19th century posed many problems. The drums could leak, and adding oil and transporting them was labor-intensive. It was also costly to make these drums and maintain them.
Also, oil cargo consists of millions of BBL of oil, which is better transported in large tankers or pipelines than in individual drums.
So, as the oil industry came up with more cost-effective and efficient solutions for moving crude oil from wells to refineries to consumers, the use of the drums gradually decreased.
That all said, BBL still remains a common unit for measuring oil volume regardless of how it is transported physically.
How Many Cubic Meters is One BBL?
Even though BBL is a popular unit for oil, in the business of crude oil, it’s mainly used in the US. Outside the US, a cubic meter is the standard unit of volume for crude oil.
One BBL is equal to 0.16 cubic meters (m³).
As the world adopted the metric system in favor of the Imperial system, cubic meters also became the standard unit for crude oil. Still, barrels played a vital role in oil transport and measuring system because these drums were used worldwide.
Interestingly, converting BBL to cubic meters is not so straightforward. As BBL is defined as equal to 42 US gallons under certain conditions, those conditions must also be the same for cubic meters. However, the American Petroleum Institute (API) defines different conditions for one cubic meter of oil (101.325 kPa and 59.0 °F).
For this reason, companies and countries that trade oil with the US use the standard BBL unit even if they use cubic meters at home.
So what is BBL in oil and gas? BBL or one oil barrel (US) is a standardized unit for crude oil, part of the measurement system common in the US. While it began as equivalent to 40 US gallons, it has been 42 US gallons since the early days of oil production. Today, many companies, especially those that operate in the US use BBL for reporting their oil production.
It’s worth noting that oil is also sometimes transported in drums equal to 55 US gallons. However, the 55 US gallon drum is not an industry standard.