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Just a little(!) light oil.
With the rougher gritts it forms sort of a slurry that keeps sanding when the grains get lose from the sandpaper.
From about gritt 1000 and up I prefer it dry.
(120-180-240-360-600-1000-1500-2000-2500)
I buffed after 2500 once, but did not see any difference.
Micro mesh goes up to 12.000, but I never used that on steel, dunno if that works
Is it possible to Mirror Finish O1, and if so, what's the best way to go about doing so?