Yes, usually the [insulating]oil is used to submerge the big switches, with the purpose of quickly kill the spark that happen between the contacts before they are closed and after they are opened, which is the main wearing factor.
Obviously this effect is present also in a low current/low voltage switch, but is so little that can be considered not existent.
Instead a conductive grease can short the contacts when they are open, so should be avoided like the plague.