The second member of the Kongdian Formation (usually abbreviated as the Ek2 shale) is one of the most significant exploring targets for shale oil at the Cangdong Sag of the central Bohai Bay Basin. It consists of siliceous shale, mixed shale, and calcareous shale. To better understand why organic matter accumulated in the Ek2 shale, we have analyzed major and trace elemental compositions to reconstruct the provenance and sedimentary environment. Tectonic discriminatory diagrams suggest that the tectonic setting of the parental rocks for the Ek2 shale belonged to the Continental Island Arc. The distribution patterns of trace elements and rare earth elements + yttrium (REEs + Y) are close to the intermediate igneous rock. The ratios of Al2O3/TiO2 ranging from 21.41 to 27.59 with a mean value of 23.93 also demonstrate a parental rock of the intermediate igneous rock. Siliceous and mixed shales indicate K2O/Al2O3 of 0.17–0.29, chemical index of weathering of 28.79–97.79, plagioclase index of alteration of 38.24–95.57, and chemical index of alteration of 40.29–80.23. These weathering proxies denote that the Ek2 shale underwent a low weathering degree in an arid climate and a high weathering degree in a semiarid climate. The V/(V + Ni) ratios and pyrite framboids indicate an anoxic sedimentary condition. The δ18O values of carbonate minerals in the Ek2 shale range from −9.8‰ to 0.7‰, and they are positively correlated to the δ13C values. The Sr/Ba ratios, δ18O, and chemical mineral associations indicate that siliceous and mixed shales were deposited in a fresh to brackish anoxic water column under a semiarid climate. Whereas calcareous shale was deposited in a saline to hypersaline anoxic water column under an arid climate.