What is the simplest way to define a local variable in Oracle?

If you want to define a local variable in PL/SQL, you need a complete PL/SQL block

DECLARE
  id NUMBER;
BEGIN
  SELECT 1000
    INTO id
    FROM dual;
END;

or just

DECLARE
  id NUMBER := 1000;
BEGIN
  <<do something that uses the local variable>>
END;

If you want to declare a variable in SQL*Plus

SQL> variable id number
SQL> begin
       select 1000 into :id from dual;
     end;
     /

SQL> print id

        ID
----------
      1000

SQL> SELECT * FROM tbl_a WHERE id = :id

Solution for Oracle SQL

DEF x = foo
SELECT '&x' FROM dual;

The result will be : foo

NB: The variable will keep the value even after execution. To clear variable run UNDEFINE x.