RoyJ writes:

OK, ya got me. I've never seen a fully oil submerged welder(only a
similar sized pole transformer rated 4130/120/120 at 5 kva). Contacts
submerged in oil does not sound like a good thing.

I've been told oil makes a better dielectric than air, so there is less
arcing as the contacts approach and faster quenching of the arcs that
form. OTOH, the oil also should be free of water and crud which
presumably starts making it more conductive.

Oil will also move heat out of an assembly faster than air convection.

I have a high voltage relay downstairs, supposedly will switch up to
something like 20kv once its oil bath is filled- though I've not
actually tried it...

Greg