The Shuguang area has great oil and gas potential in the Proterozoic and it is a major exploration target in the Western Depression. However, controlling factors and a reservoir-forming model of the Shuguang reservoir need further development. The characteristics of the reservoir formation in this area were discussed by means of a geochemical technique, and the controlling factors of the oil reservoir were summarized. The oil generation intensity of Es4 source rock was 25 × 106–500 × 106 t/km2, indicating that the source rocks could provide enough oil for the reservoir. The physical property of the quartz sandstone reservoir was improved by fractures and faults, which provided a good condition for the oil reservoir. Two periods of oil charging existed in the reservoir, with peaks of 38 Ma and 28 Ma, respectively. A continuous discharge of oil is favorable for oil accumulation. Oil could migrate through faults and fractures. In addition, the conditions of source–reservoir–cap assemblage in the Shuguang area well preserved the oil reservoir. The lower part of the Shuguang reservoir was source rock, the upper part was reservoir, and it was a structure-lithologic oil reservoir. These results are crucial for further oil exploration.