Oil appears in the spark plug well when there is a leaking valve cover gasket or when an O-ring weakens or loosens. Each spark plug has an O-ring that prevents oil leaks. When the O-ring breaks, oil begins to pool in the spark plug well. The valve cover gasket also causes oil leaks when it is worn out or not installed correctly. Valve cover gaskets are typically mounted on top of an engine to prevent oil from leaking onto other mechanical parts, such as the spark plugs.
Oil in a spark plug well is a serious problem that must be fixed right away. If the oil comes into contact with the spark plug wires, the spark plugs misfire. Even worse, the oil poses a potential fire hazard. When the spark plugs are engaged, there is the potential of igniting the oil, which causes an engine fire.
It's best to replace all spark plugs in your car when one O-ring is causing a leak just in case oil has come into contact with other spark plugs. Also, purchase a new valve cover gasket. This part provides additional leak protection. Make sure to tighten the bolts that secure the valve cover to create an effective seal.