This discovery by chemists means Egyptologists will have to rewrite the conventional recipe for mummification.
Ulrich Weser of Germany's Tuebingen University and colleagues carried out tests on embalming material found near a 3500-year-old mummy called Saankh-kare, unearthed at a site in Deir al-Behari, Egypt.
Among the bouquet of chemicals released by gas chromatography were sequiterpenoids and guaiacols - signature components found in tar and oil from cedar wood and which are known to have remarkable properties of preservation.
Pliny the Elder
The discovery supports, with a delay of only two millennia, the writings of Pliny the Elder (AD23-79), a Roman who described how the precious oil was extracted by placing cedar wood in a chamber heated from outside.
"The first liquid that exudes flows like water down a pipe; in Syria this is called 'cedar-juice', and it is so strong that in Egypt it is used for embalming the bodies of the dead," Pliny wrote.
Weser's team contends that the Latin word used by Pliny - "cedrium", which has connotations of both the cedar tree and juniper tree - has been the cause for centuries of confusion.
The findings of the study have been published in the British weekly journal Nature.