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Dielectric grease is antithetical to conduction. The only reason it works is because there is enough voltage to overcome the resistance in the grease, and this is why you do not want to use it on the O2 sensor, as it operates below 1volt.
This is also why you do not use it on grounds. It will make the connection worse! Use OxGard (available at Lowe's, Home Depot, etc.), as it is conductive and will enhance the connection and keep it clean.
OxGard on grounds.
Dielectric grease in sensor boots (except O2).
Ed O'Briant
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