I preached a revival several years ago at an "independent" Baptist church in Nacogdoches, Tx. Several bottles of oil sat around the flat part of the pulpit. I asked about it & the pastor said that they occassionally used it on someone who really needed prayer.
I have never felt led to do that nor is it practiced in any other churches that I know of. However, based on James 5:14,15, what argument could you make against it except something like, "That's weird!"