Volcanos produce methane. In fact, LOTS of things produce methane.
There's methane on the moons of Saturn.
Oil is created almost exclusively in a marine environment. All of the inland oil fields were once under sea water. It's millions of years of dead algae, fishpoop, plankton, etc., settling to the sea floor.
When there is an upthrust or the sea level drops, this muck gets covered with sand as the seashore changes its position. A whole layer of sandstone on top of the muck is the result.
Repeat dozens of times. Add some reefs and bony deposits to make some limestone layers.
Compress and heat for eons.
That's how you get oil.
..left coast enviro-wackos will find some kind of problem with mining this stuff...
count on it
If we find oil on Io, it is a whole new game.