Source of oil in Leeds, possibly (7)
I believe the answer is:
linseed
'source of oil' is the definition.
(as in linseed oil)
'in leeds possibly' is the wordplay.
'possibly' is an anagram indicator.
'in'+'leeds'='inleeds'
'inleeds' anagrammed gives 'LINSEED'.
(Other definitions for linseed that I've seen before include "Oil produced from flax" , "Oil-producing plant" , "Oil applied to cricket bats" , "Treatment for bats" , "Oil producer" .)