About two years ago Jacques Peton and a friend hauled a beat-up 1960 Chevy to an abandoned 1922 oil well he owns and connected the back wheel to a pump. After the well began producing again, they ran a hose to the car's carburetor and kept the old Chevy chugging along for months off natural gas from the well, producing more and more oil.

"I got $7,000 out of it and my friend got $7,000 'til it went dry," said Peton over coffee at Elby's restaurant. He's still shaking his head over making so much from so little, but bonanza stories are almost commonplace in this part of the Midwest where oil wells poke out of back yards and drilling rigs clog rural roads.

A two-year oil boom here and elsewhere in the nation has wildcatters and even auto body repairmen like Peton scrambling to get rich. The boom is the result of soaring world oil prices and the decision of the Carter and Reagan administration to decontrol domestic oil prices and let them rise to world levels. Oil that brought $2 or $3 a 42-gallon barrel before the Arab embargo in 1973 brings $38 a barrel today.

Decontrol, the controversial step that President Reagan implemented ahead of schedule on Jan. 28, raised the price of gasoline, home heating oil and other petroleum products across the country. But the frenzied activity in the oil fields here and elsewhere suggests that decontrol is achieving one of its purposes -- squeezing more oil out of American soil and thereby decreasing dependence on foreign sources.

"They're going crazy out there; they're even bringing drilling rigs down from Canada," said John Oshin ski, an analyst at the American Petroleum Institute, an oil industry trade organization. Oshinski said 62,374 new oil wells -- an all-time high -- were drilled in the United States last year compared with 51,263 in 1979. He said that as a result the annual decline in U.S. oil production has been slowed and will soon be reversed.

Southeastern Ohio has been oil country for 100 years but the wells produce in small qualitite, so they remained virtually untapped during the days of cheap oil. Now it seems everyone here is thinking about oil: people are supplementing incomes and heating homes from backyard oil wells, and you can listen to landowners haggling with local oil men at the Burger King.

Farmers are becoming mili-oil barons by leasing land to wildcatters for a one-eighth interest. Everywhere oil tanks -- rust-red, blue, yellow -- dot fields and hilltops. Orange natural gas pipes snake through cow pastures between gently rocking oil jacks. Roads are cluttered with oil trucks and with the mud-spattered pickups of wildcatters, roustabouts and engineers who are riding the boom.

Petroleum pervades the life of this town the way politics and bureaucracy pervade Washington life. Many of the downtown businesses are petroleum related: soil-testing firms, equipment places, and landscaping, companies that repair woods and fields after drilling. Other businesses also benefit from the influx of oil money, and there is an air of prosperity about Marietta, population 18,000.

Fred White, president of Green River Builders, estimated that the oil boom has increased his construction business by about 10 percent. "It's taken up some of the slack that general economic conditions have created for everyone," he said.

Marietta College, in the heart of town, is the only liberal arts institution in the country offering a bachelor of science degree in petroleum engineering. A fifth of its 1,300 students are enrolled in the petroleum engineering department.

"The desire to play with oil is the revitalization of an old dream here," said the Rev. Dale R. Beittel, senior minister at Christ Methodist Church. "There are those people who are obviously prospering through it, building new homes and demonstrating their money in other ways. There is employment for younger men who are making better wages than they could throwing hamburgers. There are detrimental things, too -- the pickup trucks and the mud. I don't see that it has affected the morality of the community yet. . . . The flow of oil in this area is not that great."

Ohio's total oil production of 12.9 million barrels last year was less than the United States uses in a single day, but it was significant in the sense that every barrel taken out of the ground here is a barrel that doesn't have to be imported.

"We've seen the higher price extend the economic life of wells here," said Theodore A. DeBrosse of the state's oil and gas office. "Today if your well produces a barrel a day you can hand onto it and operate it profitably."

A barrel a day isn't much by Texas standards, where the major oil companies drill wells that produce 2,000 barrels a day for years. The majors don't drill in Washington County, even though it is the hottest oil-producing region in Ohio.

A well is considered good here if it produces 15 barrels a day. A farmer with a well like that last week, with oil at $38 a barrel, was getting $71.25 a day or $2,138.50 a month just for signing on the dotted line and letting a wildcatter drill.

Check stubs for a month's production from two wells on the land of one farmer, Barber Riggs, showed that on Feb. 12 Riggs and other relatives sharing in the profits received $1,430.83 for 350.64 barrels of oil. That represented their one-eighth landowner's share in the production of the wells after $234.72 was deducted to pay the federal windfall profits tax, enacted so the government could reap some of the benefits of oil price decontrol. The stubs show that one of the wells producing about 10 1/2 barrels a day.

For the same period there was a $423.36 "override" check, a bonus paid because Riggs and his relatives originally drilled the land and gave up the right to do so when they leased drilling rights to a wildcatter. A third check, for $423.78, was for a one-eighth share of natural gas produced and sold from the wells during a one-month period.

Addie Fields, Riggs' daughter, who showed the check stubs to a reporter, said she tries to help her 94-year-old father manage his oil interests. One of these wells. "Barber Riggs No. 2," was the most productive drilled in the county last year, she said.

"I got a call from home and they said the well was just pouring out oil," she recalled of that day, May 26, when the well came in. "It produced 600 barrels the first day and continued at 500 barrels the first day and continued at 500 barrels a day for two weeks. It was still up in the 400-barrel range for some time, then in September it dropped off rather abruptly."

I wasn't until August, she said, that the first check came in from the oil company. She said it was frustrating to wait so long, but the first check was for $50,154, worth waiting for even though she suspects the oil company delayed issuing the check in order to keep the interest.

Addie Fields and other landowners say that the oil has brought problems as well as money, and at one point she spoke of the "rape of the land and the people" by oil interests. Oil drilling rigs weigh so much that they tear up the county roads. Fields and forests are scarred by makeshift access roads to the wells. Streams have been polluted and cattle have died after drinking from them.

County Commissioner James Vuksic said the huge drilling rigs and trucks are destroying the county's 346 miles of roads and 424 bridges. "We've got our own scales out there trying to enforce weight limits but for every one you catch, 100 sneak through," he said.

But the troubles are the troubles of prosperity.

James Addison, an attorney for 25 years who represents at least one large local oil producer and also invests in oil wells, said it is hard for him to make money on the investments.

"It's a suitable investment for someone with above-average income," he said, "but if it weren't for the tax benefit it woudn't have been good. I've had bad luck. . . . You can have two wells 600 feet apart and one night produce 10 times what the other produces."

Walter J. McCarthy, a real estate executive, said the oil boom has increased the value of otherwise marginal farmland. He told of a 96-acre parcel listed for $40,000. It was up in the hills and had never been tilled. No one had lived on it since 1915 and the owner was 89 years old.

"Nobody would buy it," McCarthy recalled. "We had lesser offers, then the listing ran out." The family decided to drill it themselves, "and the last time I talked to them it was still flowing at 40 barrels a day, and along with that they had three other well sites staked out. So hindsight is always 20-20. I shoulda bought that one myself."

If you drive out Rte. 7 north past the Sirloin Pit and Ken Miller's Oil Field Supply and L&M Oil Co. and the Ditch Doctor and Smith Concrete and EM Energy Mapping, you come to Don Libhart's Marietta Meter Sales.

Libhart is a 30-year-old transplanted Kansan who came here on a honeymoon in 1971, liked it and stayed. In the last year and a half he has built a thriving business selling meters and other equipment that measures and handles the natural gas that usually is found in oil wells. He started out by himself and now has 12 full-time and two part-time employes.

"This and Texas and Oklahoma is opportunity," said Libhart as he proudly showed off his warehouse crammed with huge meters, pistons, joints and pipes. "It's booming right now. This whole Appalchian basin is booming. It's gonna keep going for some time."