Abstract: In this paper, a set of differential equations of an undersaturated oil reservoir in a finite aquifer system is established for the first time based on the material balance principle. The solution of this set of differential equation gives a relationship between reservoir pressure and the time. This relationship is matched with the actual reservoir pressure history, to obtain the elastic energy factor of the reservoir and the aquifer and the water influx factor, simultaneously. By means of these parameters the initial oil in place, the initial amount of water in the aquifer, the cumulative water influx, can be evaluated simultaneously and the change of the reservoir pressure under different withdrawal rates can be predicted.