Oil likely began forming in Alaska about 250 million years ago during the Triassic period in geologic history. This is around the time dinosaurs were alive!

During this time the climate and tectonic arrangement of the earth’s plates were much different. The super continent, Pangaea, was beginning to break up and there were many low-lying swamplands and forests, which are perfect for the formation of oil and gas. It’s likely most of Alaska was covered by ocean water during the formation of its oil reserves. As marine organisms die and are deposited onto the ocean floor, they begin to decompose and this material is subsequently covered by sand, silt, and mud. As this organic material is further buried beneath seafloor sediment, pressure beings to build and the material also becomes heated from heat generated by the earth’s interior. This combination of heat and pressure transforms the decaying organic material into oil. Millions of year later, this material was uplifted by tectonic activity and we can now access the oil by drilling on land or offshore, especially in the northern part of Alaska where there are huge oil reserves.

Tectonic activity resulted in the uplift of Alaska exposing the land we see today – this activity is what actually shaped Alaska, but the oil reserves have shaped Alaska in other ways. For example, oil drilling and exploration provides jobs for the Alaskan people resulting in a boost in economic growth. On the other hand, the oil industry can also have negative impacts on the Alaska landscape and environment due to oil spills, for example, which cost millions to billions of dollars to cleanup and may permanently damage the natural ecosystems and resources that Alaskans live off of.

I'm not sure anybody knows. The oil comes from a sandstone made from river-deposited sediments from the Triassic period (the Triassic is the early part of the age of dinosaurs). I don't know enough about oil to understand why river sediments would be likely to produce it, but there is a lot of oil there. Most of what I know of from oil is that it is made in marine sediments, so this is an anomaly.