Abstract: An extraction residue obtained by solvent deasphalting of a residual oil is mixed with a carrier gas and thermally cracked at a temperature of 400.degree. C. to 600.degree. C. in a tube-type cracking apparatus to obtain cracked oil and pitch. The use of the carrier gas, which may be either an inert gas such as nitrogen or a reactive gas such as hydrogen, permits a flow velocity through the cracking apparatus sufficient to substantially prevent coking. Preferably, the cracking conditions are controlled so that the yield of cracked oil is not more than about 30 to 35%.