I have never been faced with rancid oil that had to be thrown away. I have read about some people using old oil from restaurants and making fuel to run motors, but have no idea how that works.
The only time I have dealt with rancid oil is if the place it is stored gets too hot. I have had oil keep for a long time as long as it is kept in normal temperatures. Some people don’t realize some of their cabinets can get pretty warm, especially those near or over a stove. People that are using a place like a garage or shed or even a closed off part of their home that they don’t heat or cool to store things need to think about the temperature fluctuations to decide what can be kept there.
I have been thinking in simpler terms, although I know that it is possible to use rancid oils in diesel engines. (or it might be modified diesel engines.)
What I have heard about is using the vegetable oil in question in a container with a wick and using it for light and perhaps incidental heating for a SMALL area.
Regarding the chapstick, it might also be appropriate to perhaps use it in foot care.