Here's what I found on Yahoo.com
If compression is low in one or more cylinders, you can isolate the problem to the valves or rings by squirting a little 30 weight motor oil into the cylinder through the spark plug hole and repeating the compression test. The oil temporarily seals the rings. If the readings are higher the second time around, it means the rings and/or cylinder is worn. No change in the compression readings tells you the cylinder has a bad valve