Heat loss in wellbore during steam injection is considerable due to the deep burial of medium‐depth heavy oil reservoirs, leading to a low steam quality in the bottom of well. As for hot water flooding, the mobility ratio between oil and water is small, which decreases oil recovery. Flue‐gas foam assisted thermal‐chemical flooding is a new method for heavy oil reservoir. Compared to hot water flooding, flue‐gas foam assisted thermal‐chemical flooding can decrease oil viscosity, achieving higher sweep efficiency. However, the combined mechanisms of all the injected components have not been studied systematically. In this work, the role of CO₂, viscosity reducer and hot water for oil viscosity reduction and distribution characteristics of residual oil were studied using the numerical simulation methods. Results show that although the percentage of viscosity reduction contribution of viscosity reducer can be as high as 60%, only wider range of this effect can help recover more remaining oil effectively. In the presence of flue‐gas foam, CO₂ and viscosity reducer can decrease oil viscosity in the upper and bottom layers of the reservoir, respectively. Two parameters of the area proportion of removed‐oil (ARRO) and the average removed‐oil saturation (SDRO) are defined. It is believed that both ARRO and SDRO are quite small for the hot water flooding, which is assisted by viscosity reducer. The flue‐gas foam can obviously expand the area of removed‐oil, but the average removed‐oil saturation is slightly lower. The combination of flue‐gas foam and viscosity reducer is a promising displacement method.