How does Oil effect Car axles?
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oil in the differential is i good thing, but oil or grease in the brake drum or on the brake disc isnt good. it can cause your tires to lock up with only a little brake pressure. my old truck got oil in the drums fairly often, and it would lock up one or both of the rear tires any time i stoppped in a hurry.
It depends on a particular vehicle - FWD/RWD/With axle housing, etc. Generally speaking, oil effects differential rather than axles.
because you have metal gears in the axle. you need a lubricant to run the gears in or they will just turn to dust. it would wear them out real fast.