Oil's nice possibly as a sort of lubricant (8)
I believe the answer is:
silicone
'a sort of lubricant' is the definition.
'oil's nice possibly' is the wordplay.
'possibly' indicates anagramming the letters.
'oils'+'nice'='oilsnice'
'oilsnice' with letters rearranged gives 'SILICONE'.
'as' is the link.
(Other definitions for silicone that I've seen before include "Body implant resin" , "resistant to chemical attack" , "Synthetic resin" , "It's used in, say, synthetic rubber" , "Polymer used in paints and implants, say" .)