It was one of the many illegal or at least dangerous commodities traded by the Kinitawowi GELFs. The virus's effect was best described as killing electricity. The current was disrupted and blocked, thus ending the operation of electrical systems. This affect could also be quite jarring and damaging to the equipment it was inflicted upon.
Trying to rescue Lister's other self from across the omnizone, the Starbug crew traded with the GELFs to aquire it as well as some odd and damaged androids to act as soldiers. From there they used it to shutdown the systems of the Great GELF State's penal colony of Cyberia, where Lister's doppelganger was being held. This did allow our Lister to rescue him, though he was nearly killed in the process as the virus took out the artificial gravity on the asteroid of Lotomi 5 and pulled him up into a now floating cyberlake. Meanwhile, even infecting Cyberia proved perilous as Kryten, Rimmer and Kochanski were discovered by a Dolochimp guard and his companions.
The virus was to prove key to defeating the Rage. Rimmer's damaged Light Bee was infected with the virus and as a last, out of character act of courage he lay in the path of the Rage. The Oblivion Virus then proceeded to kill and disrupt its electrical charge, saving the Starbug crew and their new friends including Rimmer's son, Michael McGruder.