Two reasons: heat convection and flavour dissemination.
Oil acts like an interface between the hot surface of the pan/pot and the food you’re cooking. It basically fills in the little gaps of the food and the cooking surface. It’s also essential for the Mailliard reaction, which is carmelization of any starches, carbohydrates, and sugars the food contains, which gives us all those “flavour molecules” as I like to call them.
For flavour, a lot of volatile molecules which are responsible for the flavours we like are fat/oil soluble, so oil will readily take up the flavour and odour of just about any volatile molecule.
This is why you’re advised to keep your butter separate from anything like garlic, coffee, or any other strong-tasting or -smelling thing (ice cream, too…..mmm…french vanilla and garlic).
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