Transformer oil has the task of cooling and electrical insulation of the transformer. Magnetic and electric fields in the transformer cause energy losses, and the heat resulting from these losses heats the core, copper coil and other conductive parts, and as a result, the temperature of the transformer rises. If the transformer is not cooled, the temperature of the equipment will increase too much. At this stage, the oil plays its cooling role and by transferring heat from the core plate, winding and other parts, it prevents the temperature from increasing too much.

The design of electrical equipment is based on their need for suitable insulation systems that include solid and liquid materials. In an insulation system, the liquid part plays a vital role and must be able to withstand electrical stresses.

Based on the type of material used in the base of the product, transformer oil is divided into two types of paraffinic and naphthic base, and the use of naphtha type is more important due to the production of less sediment.