You pour oil on it, and wait for it to go out.
when you light an object in TPT on fire then spray water on it from a distance, It doesn't remove all of the fire it just shrinks the fire down a bit and then the fire grows back to the original size. For example fill half th screen with oil and then light it. After Spray as much water as you can on it. You will fnd that most of the water is pushed away from the fire aand the water which dose touch the fire will not help a bit. If the element foam was used in the same situation then it would rapiddly fall on to the oil because of its high density/viscosity and rapidly cool and lock the oil in a non flammable state. Making the foam more effective than other elements which can kill fires.
You don't put out an oil fire with water ;p
Try with a woodfire
also we have soap which might result in foam being confused with it,
Exactly my point, there is no element which can efficiently extinguish the oil fire (and some other fires like coal fires etc.). and even though soap and foam would be confusing they could be labeled with different colors or foam wouldn't be just called foam instead you could call it FEF (Fire extinguishing fluid) to make it less confusing.