He adds oil to the gas? Didn't you say it's a Jetta TDI? Those are diesel. If he's adding oil to a tank of diesel,
I'd assume that is indeed for lubrication purposes. I would never fill a diesel tank with gasoline and oil, I'm sure it
would go kablooey.
People with diesel trucks run vegetable oils, grease from deep fryers, used motor oil, etc. as fuel. They generally
have to be filtered by some method. My coworker has an F-250 that he has a 65 gallon auxiliary tank for vegetable
oils, motor oil, etc. Besides filtering (he uses a centrifuge), the only other consideration is the temperature of the fuel.
In many cases, if you are going to run an auxilary fuel system in this manner, you need a heater of sorts.
There's all kinds of options, some even route coolant lines through the auxiliary tank to heat the fuel. If not
warm enough, the fuel is too thick for the injectors and pumps. Either way, even with heating the fuel, you
generally need to start the engine on diesel and then once you've reached operating temperature, you can
switch over to the oils.
Some people add a small amount of diesel, kerosene or sometimes gasoline to a large tank of waste oil to
thin the mix. Others run what is known as "Waste85", 85% waste oils 15% diesel.