First of all, canola oil has a fairly high smoke point, 400 degrees F. And canola oil is not volatile; the oil doesn’t give off a lot of gasses at normal atmospheric temperatures. As a cautionary note, paper towels would be more combustible than cloth rags, but the oil component would not be. All that being said, I would not keep the trash next to the grill because anything in the trash might catch an errant flame/lit grease splatter and cause the trash to light.