Think of it this way. You're a seasoned witcher. You know the ins and outs of fighting and of the many monsters and oddities out there. You even spent the time to make the oils.

It's just the witcher's learned instinct to apply the relevant oil when fighting a monster. It's second nature. You don't even think about it. It's how it should be, narratively speaking and this is a narrative driven game where you role play as the witcher. It may not allow for min maxing your strategy, but it makes sense and is convenient.

Now, you the player do not always remember to apply it or even do it quickly. But the witcher does. He has the muscle memory down. The witcher is always ready. And you are the witcher.