However, I made my first carrot cake with sunflower oil and I was impressed at how moist it stayed compared with using butter. Obviously, oil at room temperature is a liquid, unlike butter, and so it made sense when I eventually spoke to a science teacher at school. It was possibly my first insight into the mystery of ingredients, a budding molecular gastronome I was indeed.
Not long afterwards I started making tomato soup cake - I think from the Radio NZ Cookbook - so the use of vegetables and oils in baking soon became less impressive as I turned to spices and differing sweeteners in my cooking to see what I could create. I discovered the joys of cinnamon and cloves, honey and golden syrup, and the use of oils and veges seemed old hat by the end of the year.
But to answer your question, pretty much any edible oil can be used, and what they taste like in their raw state is what they'll taste like in their cake-state. Avocado oil is extremely rich and (usually) green - so it can be an advantage in a pale cake as it gives it a lovely hue and subtle flavour. If you use this, also replace some of the sugar with avocado honey which I've seen in NZ - an amazing honey from the blossoms of avocado orchards. Using olive oil in cakes is something that has appeared in the past decade - the more "extra virgin" the oil, the stronger the taste, which can be grassy or peppery depending on the oil used. For a more subtle taste use olive oil with no mention of virgin.
Cold-pressed rape-seed (canola) oil from Britain is a wonderful oil to use in baking - it's the colour of golden saffron and has almost no taste. In NZ we use canola oil from Australia which is nice and stable. For general baking, use this or sunflower oil - they'll be tasteless and colourless so won't affect your baking.
Also consider using various nut oils (hazelnut and walnut oils can add a fabulous richness) or lemon, chilli and even truffle-infused olive oils or infused avocado oil. If the fruit cake you're making is really dense and heavy then the subtlety of these latter oils may be wasted, although a good slosh of chilli-infused oil will be an unexpected surprise for your afternoon tea guests.
* To ask Peter a question, click on the Email Peter link below.