Detailed description of the heterogeneity of oil/gas reservoirs is needed to make performance predictions of oil/gas recovery. However, only limited measurements at a few locations are usually available. This combination of significant spatial heterogeneity with incomplete information about it leads to uncertainty about the values of reservoir properties and thus, to uncertainty in estimates of production potential. The theory of stochastic processes provides a natural method for evaluating these uncertainties. In this study, we present a stochastic analysis of transient, single phase flow in heterogeneous reservoirs. We derive general equations governing the statistical moments of flow quantities by perturbation expansions. These moments can be used to construct confidence intervals for the flow quantities (e.g., pressure and flow rate). The moment equations are deterministic and can be solved numerically with existing solvers. The proposed moment equation approach has certain advantages over the commonly used Monte Carlo approach.