I read some were that the oil in leather causes rust if that is so why are knife sheaths and gun socks and holsters all made of leather
My understanding is that only latigo tanned leather will do that.
Possibly because the inside of a sheath isn't finished with dye and oils, but when you rest something on the finished side with those chemicals, a chemical reaction is created?
Supposedly the old tannin-type or brain tanned leathers won't but the chrome tanned leathers can cause corrosion with long time storage. That's why brass cartridges and so forth develop verdigris if left in contact with leather. At least that's what I read a long time ago.(way pre-internet)
Stumblin is right, latigo will rust a carbon steel blade in 24 to 48 hrs. Enough so that I've been thinking it might be a good way to artificially age a blade.
Halfstock
No crap on how fast latigo will rust??? I like to brown some of my reproductions using "Birchwood & Casey" browning solution, works great w/ a little heat.