How does insulating oil affect transformer thermal and dielectric performance?

Insulating oil directly influences both thermal and dielectric performance by removing heat from windings and providing electrical insulation. Efficient oil circulation lowers operating temperature, reducing insulation aging and improving load capacity. Electrically, oil fills voids, suppresses partial discharges, and increases breakdown voltage. Poor oil quality leads to overheating, increased dielectric losses, and higher risk of internal faults, making oil condition critical to transformer performance.