The carburetor shown in the picture came from an RC Car engine. That's why the needle is positioned the way it is.

Because it's a plain bearing engine, we'd strongly suggest a fuel with no less than 20% oil content that contains mostly castor oil as the lubricant. 20% castor would be great, but a 50/50 mix of castor/synthetic would be OK. A higher oil content would not hurt the engine at all.