A preservative works to prevent the bacteria or fungi present in a product from multiplying. A face cream, for example, will stay safe to use for 1-2 weeks if it’s kept in the fridge, but adding a small amount of preservative will extend its shelf life by 1.5 to 2 years.
Waterless products such as balms and oil blends can have a shelf life of approximately 1.5 to 2 years as bacteria will not grow in an anhydrous (waterless) environment. This is provided that the formula contains an antioxidant of some kind to protect the oils. Free radicals cause damage to cell structures and in time lead oils to oxidise and go rancid. Antioxidants work by fighting against this free radical damage and stopping the oils present in a product from going rancid too quickly. You can often tell when an oil has gone rancid by the smell, and needless to say, products that have gone off are not going to be of any benefit to your skin and will actually cause more harm than good.
It is therefore advised to add Vitamin E (Tocopherol) to waterless products as the antioxidant will help prevent the product from going rancid. You'll often see oils that have 0.5% Vitamin E added to them such as Evening Primrose Oil and Hemp Seed Oil, which helps to extend their shelf life. Rosemary Antioxidant is also often included in formulations to further protect the products.