Nation producing oil (6)
I believe the answer is:
anoint
'oil' is the definition.
('anoint' can be a synonym of 'oil')
'nation producing' is the wordplay.
'producing' indicates anagramming the letters.
'nation' is an anagram of 'ANOINT'.
(Other definitions for anoint that I've seen before include "Administer sacred oils as to the sick" , "Bless with holy oil" , "Confirm as successor" , "Bless with sacred oils" , "Consecrate with holy oil" .)