Mike:
Permatex High Temperature Thread Sealant #59214 is OK in oil (petroleum) applications because it does not "coagulate" (for lack of a better term).
Teflon-based stuff (tape, thread sealer) has a bad habit of disintegrating and attracting to itself or like stuff in the absence of oxygen and "clumps". Not a good thing in our applications.
Room Temperature Vulcanizing (RTV) silicone stuff is derived from petroleum products and can disintegrate (break down) in the presence of some (other) petroleum products. It may or may not "clump" depending on which one you use and the environment it's used in. That means that it is questionable whether you can use it in heavy oil applications - definitely not in the presence of gasoline and maybe not near crankcase oil, but that depends on what's used, how it is applied, set up and cured. The blue stuff is OK for general seals (oil pans, case halves, etc.) as long as it fully cures before being introduced to oil. If it's cured for a couple of hours and immediately exposed to oil - not good.
There are some industrial RTV compounds (Gray, used in the military) which tolerate gasoline and kerosene well, but they're not available at your local auto parts store.
I use a high-pressure, non-teflon, paste thread sealer on oil connections. I can't remember what the hell it's called, but I think Stan recommended it and I bought a tube locally. Bring your deep credit card when you buy it - it was something like $50 bucks per tube. I'll get out to the shop tomorrow and see if I can find my tube and report back (It's close to 11pm here, now).
gn