Well, maybe not the algae themselves, but algae poop.
Even more likely is that oil is formed from bacteria. After all, SOMETHING ate all the oil from the BP leaking seafloor well. Maybe oil is produced from algae and bacteria poop.
yes. Algae, moss (from bogs) and just about any other type of vegetation that got trapped beneath the surface and worked its way (through the eons) down close to the earths molten core.