Light Oil is a petrochemical liquid product produced when processing Medium Oil in the Distillation (Stage II). It can be further processed in a Distillation (Stage III) machine to produce Naphtha and Fuel Gas. Alternatively, it can be burned in a Boiler (Gas) to generate Steam Hi , and thus generate Electricity.
Burning Light Oil directly to create steam is a viable option before Naptha Processing is researched. However, using a distillation stage III machine to separate Light Oil into Naptha and Fuel Gas and then burning the two products separately produces significantly more energy than burning the Light Oil would