It seems every time we turn around there is another discussion going on about how to fuel cars in the future. The opening of that sort of debate usually includes a mention of how expensive and polluting gasoline is, which begs the question, "Why do we fuel our cars with that stuff?" There's actually a very good reason for it, and it's firmly grounded in science.
For a substance to be useful as fuel it needs two crucial characteristics. First, it needs high energy density. Second, it needs a high energy source value. Oil has both, but to understand why that's important we need to understand what those terms mean.
Energy density, in simple terms, is how much energy we get out of a substance when consuming it as fuel. The big winners in that contest are nuclear fuels, able to provide enormous amounts of energy from a tiny amount of radioactive material.
Typically a nuclear plant is used to produce heat, which boils water into steam, with the steam channeled to turn a turbine and produce electricity. In concept it's pretty much the same process you'd see in 1850s-era locomotives powered by coal.
It's not really useful as an auto fuel, though, as it's tremendously rare and expensive. Nuclear fuels are also very dangerous and managing a reactor isn't something an untrained person should do.
The second highest energy density substance on the planet is oil. While burning it doesn't produce nearly the energy of a nuclear reaction it absolutely beats any other chemical reaction on earth for energy output. Using wood as a fuel produces about 1/15 as much energy as an equivalent amount of gasoline. Oil-based fuels simply give the most energy per pound.
Energy source value describes how much energy it takes to produce a fuel compared to how much you get back. If you get receive more energy than you put into getting a fuel the substance is an energy source. If it takes more energy to produce the fuel than it provides when used, it is an energy sink.
Of all the commonly used fuels oil has the lowest cost of production compared to the amount of energy received by getting it out of the ground. That gives it the highest energy source value, allowing it to cost less per unit of energy produced than any other source.
Burning a fossil fuel to power a vehicle is not the cleanest process in the world, and there is really no way to burn fuels without producing pollution. Interestingly, since oil produces so much energy from such small amounts of fuel it actually produces less pollution than some alternatives. It's just a matter of needing to burn so much more of any other substance to produce the same amount of energy.
While we continue to use gasoline to power our cars research continues into alternatives. Hybrid car designs, plug-in electric vehicles, and motors engineered to use less fuel are all evolving sciences as well. In the future other fuels, other car designs, and new ideas we've not even dreamed of will shape the way we drive and how we power vehicles. Until then gasoline is the best bang for the buck.
Reference
Fuel energy density chart
http://www.generatorjoe.net/html/energy.html