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Oil is a generic term for a slippery liquid that won't mix readily with water. Oils vary widely in composition but generally consist of mixed organic compounds.
Oils find frequent use as lubricants, fuels, and solvents. Transformers are among the users of oils in these capacities; however, they sometimes consume certain oily substances in larger quantities than strictly required, resulting in impairment of certain functions, disorientation, and temporary mental dysfunction. Though at first it may seem odd, some actively seek these seemingly-deleterious effects. What is odder yet is that humans seek out and consume varying solutions of a certain hydrocarbon with a single hydroxyl group and experience effects quite similar to those mentioned above. Further study is needed to explain this strange coincidence.
Generation One cartoon
The Decepticons raided an offshore rig drilling for oil, converting the oil into energon cubes. The Autobots arrived to stop them, resulting in the destruction of the rig. While the Decepticons got the Energon cubes, the Autobots managed to save the crew, and started their long friendship with the Witwicky family.
Marvel Comics continuity
Head on down to Maccadam's Old Oil House for a pint.
Beast Wars II cartoon
Galvatron was a violent oil-oholic, constantly over-energizing and then rampaging.
Transformers: Animated cartoon
- Bumblebee offered the phrase "Eat crankcase oil!" as an epithet, implying oil from a crankcase is considered less desirable or even unpalatable by Transformers.
- Oil is apparently the equivalent of beer or wine for Cybertronians in the Animated series. Scrapper and Mixmaster enjoy it from "pint glasses" (barrels) at the "bar" (some random tanker) after a hard day's work. Megatron, however, seems to have specially-made "goblets" for his own stash. The quality of oil could also be analogous to said human alcoholic drinks as Mixmaster says that the Autobots' oil "tastes like water" compared to Megatron's, who calls it his own "private blend".
- Dirt Boss only wants oil to torture his refinery.
- Sari was making a special type of oil called "Oilnogg". Soundwave shocked it causing the Autobots to get drunk as they drank it. The next morning, they became human.