A method of operating a diesel or spark ignition engine which includes enriching the combustion air supply with oxygen while simultaneously adjusting the fuel injection or ignition timing of the engine to compensate for advanced combustion caused by an increased oxygen content in the conbustion air. Oxygen producing means such as an oxygen generating membrane can eliminate the requirement for, or significantly reduce the size of, an intercooler which is normally installed between a turbocharger and the air/fuel inlet of an engine. Oxygen enrichment of the combustion air permits combustion of otherwise unsuitable or difficult to combust fuels such as residual or heavy fuel oils, alcohol and alcohol blends, seed oil and blends of light gas oils and residual or heavy fuel oils.