"Meanwhile to those of you who still have the will to live, oil has been placed on the first floor of the mansion. Take as much as you need."
The improper destruction of zombies infected with variants of the t-virus permitting V-ACT can bring the creature back to life; with the added bonus of increased muscular density, whilst the cells in the body begin cellular reproduction, which recovers wounds and reverses the effects of rigor mortis. This creature is made worse with its ability to run along with the nails becoming claws.
Umbrella used this chemical - along with others - which, when set alight, burns the infected creature and stops the t-virus recovering.
The Arklay Laboratory, Spencer Mansion and a workers' quarters began placing canteens of Kerosene around the area to stop zombies and raise workers morale, knowing that there was some way to save them.
Jill and Chris can refill the Fuel Canteen with the kerosene of the tanks, but the kerosene in the tanks is not unlimited: each can only refill the canteen for up to four uses each.
Some corpses do not become active zombies until certain conditions are met. Kerosene can be used to set them on fire before these conditions are met, saving the player the trouble of having to bypass the zombie or waste bullets on it.