What is the transformer oil purpose in insulation systems?

In insulation systems, transformer oil provides the main liquid dielectric between energized parts and grounded structures, reducing electric field stress and preventing arcing. It impregnates cellulose insulation, filling micro voids and improving dielectric uniformity. Oil also carries away heat, keeping insulation temperature and aging rate under control. In addition, oil serves as a diagnostic medium because fault gases dissolve in it and can be analyzed to detect internal problems before catastrophic failure.