What is the oily substance leaking from your Toyota Sequoia AC drain?

The oily substance leaking from your Toyota Sequoia's AC drain is likely a mix of condensate and refrigerant oil. As the air conditioning system operates, it removes humidity from the air, resulting in condensate that can mix with lubricant oil used in the AC system. This mixture can sometimes appear oily and may leak from the drain. If the leak is excessive or accompanied by other symptoms, it's advisable to have the system inspected for potential issues.