Where do oil, natural gas and coal come from?

Hydrocarbons (coal, natural gas, oil) come from the remains of living things. Intuitively, this may seem odd at first since we think of animal or plant material as decaying over time. The decaying process is called oxidation since oxygen chemically reacts with organic material. But what if organic material was not exposed to oxygen? When we preserve food in air tight bags or cans, we are trying to keep air out or more specifically oxygen from attacking and oxidizing the food. You can think of hydrocarbons as the product of organic materials that have been preserved in an anoxic or oxygen poor environment so that decay did not occur.

Oil is formed from the remains of animals and plants (diatoms) that lived millions of years ago in a marine environment before the dinosaurs. Over millions of years, the remains of these animals and plants were covered by layers of sand and silt. Heat and pressure from these layers helped the remains turn into what we today call crude oil. The word "petroleum" means "rock oil" or "oil from the earth." 

The main ingredient in natural gas is methane, a gas (or compound) composed of one carbon atom and four hydrogen atoms. Millions of years ago, the remains of plants and animals (diatoms) decayed and built up in thick layers. This decayed matter from plants and animals is called organic material — it was once alive.  Over time, the sand and silt changed to rock, covered the organic material, and trapped it beneath the rock.  Pressure and heat changed some of this organic material into coal, some into oil (petroleum), and some into natural gas — tiny bubbles of odorless gas.

The following passage might help clarify this process "The Petroleum Industry" Charles F. Conway (p20-21):

"Two conditions are necessary for oil and gas to have formed. First, is wholesale death is necessary to provide a sufficient volume of oil and gas. Second is the rapid burial of the dying organisms is necessary to prevent the bacteria from consuming them. A good present day example for an oil gas rich environment is the entrance of the  Black Sea by the Straits of Bosporus near Istanbul, Turkey. Currents from the Mediterranean rush through the strait into the Black Sea, and immediately plunge to great depths.  The waters are rich in micro-organisms that undergo wholesale death as they are carried downward into non-oxygenated waters.  The dead organisms sink to the bottom and are quickly buried by the rapid clay deposition in the area and this protects them from bacterial action."

Coal is a combustible black or brownish-black sedimentary rock composed mostly of carbon and hydrocarbons. It is the most abundant fossil fuel produced in the United States. Coal is a nonrenewable energy source because it takes millions of years to create. The energy in coal comes from the energy stored by plants that lived hundreds of millions of years ago, when the Earth was partly covered with swampy forests. For millions of years, a layer of dead plants at the bottom of the swamps was covered by layers of water and dirt, trapping the energy of the dead plants. The heat and pressure from the top layers helped the plant remains turn into what we today call coal.