Mountain Rose is correct. Oregano is what is known as a "hot" oil, it can cause a skin or mucous membrane irritation if not diluted.
However I think it may be overkill to add 1 or 2 drops of oregano to a few cups of carrier oil.
A general rule of thumb for oregano and other "hot" oils, like peppermint and thyme, that I learned from my ACHS schooling is:
1 drop of EO to a teaspoon up to a tablespoon of carrier oil.
This formula has always worked for me.
Always skin test first. Apply the oil mixed in carrier oil to the forearm. If redness or rash develops you may not want to use that EO.
I also agree that diffusing oregano doesn't sound as pleasant as maybe lavender.
I would only diffuse if I wasn't home to sanitize the house.
Oregano is very powerful as an antiseptic and antiviral oil. Just the ticket for cold and flu season.
I also use oregano internally as well. I can hear the uproar starting. If you want to know how I use oregano internally let me know.
Disclaimer:
By the way I do not treat, cure, diagnose nor prescribe. this is for informational purposes only.

Check out the oil pulling forum. I mix oregano oil with coconut or flaxseed oil and swish (or pull) for 20 minutes. It's an ideal delivery system to absorb throughout the body.

I've used it to cure tooth abscesses, tooth infections (that saved me two root canals), and when I get serious flu's or respiratory illnesses (bronchitis, pneumonia, etc) I pull with it twice to three times a day instead of taking Antibiotics . It's great stuff.