EDIT: I realized exactly what you were saying after writing the below. I'm modifying it, but I don't know when you will see it, so please forgive me.
Yes, the correct way is to modify the substance that other mods produce to be the base oil, but even still, I would really like this to be compatible with the mods in ATOM ( https://mods.factorio.com/mod/all-the-overhaul-modpack ), and so far as I can tell, this is the only incompatibility.
Honestly, your mod is excellent; if I have to choose, I will take this one, but I would really like the two to play nicely.