> Arcing is a problem with open air transformers too, and one of the functions of oil in oil-filled transformers is to prevent arcing.
That's part of the reason for oil-filled transformers. The other reason is to cool the heat-generating parts by relying on a liquid's tendency to create convection loops between the warmer and cooler areas.
A quote: "Transformer oil or insulating oil is usually a highly-refined mineral oil that is stable at high temperatures and has excellent electrical insulating properties. It is used in oil-filled transformers, some types of high voltage capacitors, fluorescent lamp ballasts, and some types of high voltage switches and circuit breakers. Its functions are to insulate, suppress corona and arcing, and to serve as a coolant."
That's part of the reason for oil-filled transformers. The other reason is to cool the heat-generating parts by relying on a liquid's tendency to create convection loops between the warmer and cooler areas.
http://en.wikipedia.org/wiki/Transformer_oil
A quote: "Transformer oil or insulating oil is usually a highly-refined mineral oil that is stable at high temperatures and has excellent electrical insulating properties. It is used in oil-filled transformers, some types of high voltage capacitors, fluorescent lamp ballasts, and some types of high voltage switches and circuit breakers. Its functions are to insulate, suppress corona and arcing, and to serve as a coolant."