Oily liquid cools off, covering middle of street (7)
I believe the answer is:
creosol
'oily liquid' is the definition.
(I've seen this before)
'cools off covering middle of street' is the wordplay.
'off' is an anagram indicator.
'covering' indicates putting letters inside.
'middle of' indicates the central letters.
The middle of 'street' is 're'.
'cools' anagrammed gives 'cosol'.
'cosol' enclosing 're' is 'CREOSOL'.
(Other definitions for creosol that I've seen before include "Oily liquid" , "Chief part of wood-tar creosote; coolers (anag.)" .)