What’s got people thinking about possible non biological sources of carbon energies is that there are methane and ethane clouds on places like Titan—one of jupiter’s moons.
The atmosphere of Titan is largely composed of nitrogen; minor components lead to the formation of methane and ethane clouds and nitrogen-rich organic smog. The climate—including wind and rain—creates surface features similar to those of Earth, such as dunes, rivers, lakes and seas (probably of liquid methane and ethane), and deltas, and is dominated by seasonal weather patterns as on Earth. With its liquids (both surface and subsurface) and robust nitrogen atmosphere, Titan’s methane cycle is viewed as an analogy to Earth’s water cycle, although at a much lower temperature.http://en.wikipedia.org/wiki/Titan_%28moon%29
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As well, there are artificial ways these days to make gasoline from CO2 — without using algae or bacteria,
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I have no strong opinion on this. For now I tend to believe that oil in the ground came from dead plants and animals of earlier epochs. but evidence suggests there’s more than one way to skin a cat and more than one way to make gasoline. whether that’s in fact what happened is another matter.
Carbon and Hydrogen atoms in a non-oxygen atmosphere would eventual equalize at the lowest energy state. Without oxygen, that would be methane, ethane and the like depending on the ratio of atoms.
If a planet/moon has hydrogen and carbon and little to no oxygen, I would be surprised to find it wasn't methane and ethane.
If the Titan has iron, will you be surprised there is no rust, iron oxide?
If you look at geology information, you will find oil is associated with ancient water source and the sedimentation that accumulated underneath.
We can squeeze oil out of algae today. Is it really surprising when algae and the like is trapped under sediment away from a source of sufficient oxygen, it does not decompose into lots of H2O and CO2 like it would on the surface?