Abstract: Methods for quantifying the oil and water fractions of a fluid stream. A first method broadly includes making optical density (OD) measurements of the fluid stream by detecting photons of a first predetermined energy where the oil and water absorption characteristics are substantially identical (e.g., 1710 nm wavelength), and determining the oil and water fractions f.sub.o and f.sub.w according to OD.perspectiveto.f.sub.w .alpha..sub.w l+f.sub.o .alpha..sub.o l where .alpha..sub.w and .alpha..sub.o are related to the absorption coefficients of the oil and water at the predetermined energy, l is the path width of the fluid stream, and f.sub.w +f.sub.o =1. A second method which eliminates scattering effects utilizes the photons at the first predetermined energy and further utilizes photons of a second predetermined energy which is sufficiently close to the first predetermined energy such that the oil fraction is a linear function of the OD over the energy range.