Carbon monoxide (CO) is a by-product of combustion, present whenever fuel is burned. You cannot smell these fumes. It is a colorless, odorless and tasteless gas that is slightly less dense than air. Besides furnaces, any gas-fueled appliance produces it – clothes dryers, ovens, grills, fireplaces, etc. If your home is properly vented, CO will be safely directed outside.
However, a cracked heat exchanger, blocked vents, or an inadequate air supply can force contaminated air back into the home. In this scenario, you might smell an oil odor (and possibly see smoke and soot), which should prompt you to call a technician, before any carbon monoxide is released. Ironically, the risks of carbon monoxide have increased in the past several years because sealing up and weatherizing our homes reduces ventilation.
Even though the dangers of carbon monoxide are much lower in a house with an oil heat system (as opposed to a gas furnace), a CO detector is always a good idea.