I have read that you can do this, but I didn't like the idea of using something I use to cook to put on my baby's skin... With both of my kids I would wash their hair with baby shampoo and after gently massage their scalps with a very soft baby brush. It helped to loosen some of the dry skin so that I could rinse it away. Be careful not to do so too much as you could irritate the baby's scalp and potentially make matters worse.
Mineral oil (such as baby oil) clogs pores. It's actually much better to use olive oil for moisturizing.
I used it on the heads of my two when they were young with no problem and my daughters skin was very sensitive too, she suffered with bad skin allergies, we couldn't even use any Johnsons baby products on her. It is totally natural, we are lucky enough to get fresh local olive oil straight from the press.
Olive oil is generally safe for humans, even infants. There are only two things you want to look out for. First is that you want to make sure to get Organic Extra Virgin Olive Oil, because it is free of harsh chemicals used in non-organic non-virgin brands.
The second thing to be mindful of, is that your baby might have an allergy to olives or olive oil, so only try out a very very small amount first on his or her arm, then wait a few hours to see if a rash, red mark or welt develops. Then take it in small steps from there.
I'd like to suggest though, that while Olive oil is a good choice, I would get some Hemp Eaze. It's totally non-toxic, uses only fresh organic herbs and is great for dry skin. Get the "Baby and Me" spray, it works the best.
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You should wash his head once a day with baby shampoo, and massage it. You can also apply mineral oil 1 hour before washing his head. You can look for specialized shampoos as well, and if a rash appears use a smooth creme with cortizone.
I come from the Middle East where Olive Oil is used from belly aches to natural anti aging remedies. As long as there's not a risk of being allergic, I don't see it as a problem, but always check with a professional.
Really you could use baby oil for either purpose. For dry skin you are trying to add moisture for cradle cap you are trying to loosen it in order to remove it.
If it is cradle cap after you have gently massaged it into your baby scalp take a comb and see if you can get some of it off. It is very common and my son had it for months. I was not able to remove it from his very large soft spot so as it got smaller I would have to repeat the process.
I like to call my doctor whenever I am unsure about something. He is extremely helpful.
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