The term "oil" in herbal medicine can be a confusing matter without clarifying exactly what type of "oil" we are talking about.
There are two very different types of oil-based herbal medicines. They are known as essential oils and infused oils. Both essential oil and infused herbal oil are made from herbs or plants. Infused herbal oils are diluted, while essential oils are pure concentrated oils.
Essential oils cannot be made easily at home. They are the pure plant oil, usually extracted by chemicals or hot steam. Hundreds of pounds of fresh plant material may produce only ounces of essential oil. Essential oils are readily available commercially. They are used in aroma therapy, as insect repellents, and to increase local circulation. Essential oils are intended for external use. They can be fatally poisonous if taken internally in quantity. They are also highly irritating to the mucus surfaces of the body (genitals, mouth, eyes, etc.) and may cause allergic skin reactions in some people. Be certain to keep all essential oils well out of the reach of children.
Infused oils can be made at home. They are usually reserved for external uses, but could be taken internally without disastrous results. Infused oils are much less potent than essential oils and have none of the associated side effects. Infused oils can be made from fresh or dried plant material. I prefer to use dried plant material because fresh plants contain water which may lead to rotting or mold when used with oil. You can infuse herbs in any type of oil: olive, safflower, apricot, coconut, etc. The lighter, clearer oils are expensive; they produce delicate and beautiful infused oils. Extra Virgin Olive Oil is my personal choice; it rarely turns rancid, is absorbed easily into the skin, adds its own healing benefits to the preparation, and is available inexpensively.
Infused herbal oil is prepared by crushing or chopping the plant, or herb, and placing it into oil, such as jojoba, or olive oil. The properties of the plant are then infused into the oil for several weeks before straining the plant from the oil using cheese cloth. The plant or herb is then discarded. Infused plant oils carry some of the properties of the plant, but are not concentrated because they are diluted by the other oil.
To make infused herbal oils like Lemon Balm Oil, Calendula Oil and St. John's Wort Oil, I use a traditional process called digestion. Digestion is a very low heat, prolonged extraction designed to draw out the plant's bioactive compounds. I usually use food-grade, cold-pressed extra virgin Olive oil to make my infused oils. Fixed oils dissolve many of the same compounds that dissolve in alcohol and the resulting infused oil represents a whole herb extract of the plant.
Essential oils come directly from the plant or herb and contain no other oils or ingredients. To produce essential oil a distiller is required. An essential oil distiller works by passing steam over the plant or herb. The steam carries the properties of the herb to a condenser. The condenser collects the plant oil and cools it eventually dripping the plant oil back into a receptacle called a collector. Because they are very concentrated essential oils should not typically be applied directly to the skin. Instead, they should be added to a carrier oil, such as jojoba, olive, or apricot kernel oil.
Essential oils are the highly aromatic, active plant oils that are commonly used as fragrances, flavorings and in aromatherapy. These oils tend to evaporate or volatilize fairly easily at moderate temperatures. It is this volatile character that allows their aroma to reach your olfactory receptors and be perceived as fragrant. Natural essential oils occur in complex combinations that have a fairly specific composition for each plant. In herbs like Peppermint, Lavender and Cinnamon, the unique phytochemical composition of each oil is responsible for the highly distinctive aroma of the plant.
Infused herbal oils use a small amount of plant material; essential oils require tons of plant material. Infused herbal oils are safe to use internally or externally. Essential oils are poisonous internally and can be problematic externally if used undiluted. Infused oils are used full strength; essential oils should be diluted before use. Infused herbal oils have subtle scents; essential oils have powerful scents.