As usual the answer is somewhat nuanced and not perfectly clear in every situation. But it might be useful to think about fundamentals for a moment.
Teak Oil, Varnish and Tongue Oil have a lot in common. But what's a varnish? A useful oversimplification is to say that it is a drying oil, a resin and a carrier. A drying oil is a natural oil that will "cross-link" and cure. Resin is used to leave behind solids and it partners well with the cross linking drying oil. So that's basically what a varnish does when the carrier flashes off.
There are a small number of drying oils, but one of the best is Tung oil! The most popular in varnish is often tung or linseed, linseed being a little less expensive but still has a durable track record.
Teak oil on the other hand, again a bit of a useful oversimplification is basically a drying oil with a carrier but often not the resin, or if there is one it is a low concentration.
So.....by using straight Tung oil, you are achieving a slightly higher build version of teak oil.
So how does teak oil hold up? As usual that depends. In Seattle type weather used externally with just a coat, it basically dries out and can often be recoated, but if you apply frequently enough to cure a bit more and start leaving a finish, it tends to turn mildew black when the weather turns wet at which point the only option is to strip it off and start over. I actually knew a guy who put teak oil on his Nordic Tug and when it turned black, he kept going but would wash it periodically. When I saw it, it was a shiny pure black that actually looked fantastic. When my teak turned black, it looked like hell, so there is a period to go through it you want to see what 10 year black teak oil looks like but I've only seen one that looked good.
As far as Tung oil, its not going to build as fast as varnish will because it has no resin, but it does have the magical cross link curing going on so it will build and faster than typical teak oil. I have not used it this way, but have heard from those who love it and do believe that if persisted with it, it builds to essentially a protective varnish exterior and Tung oil looks fantastic.
Why does it not turn black like teak oil? I have no idea, but I've come across a few who swear by it that I tend to believe its possible.
Sorry not a perfect answer, but hopefully it gives you a bit of fundamental background of the whole drying oil, teak oil, varnish mystique. Years ago lots of people made their own, instead of store bought. Kind of hard knowledge to come by today. Varnish itself is more of a spectrum than a particular formulae ranging from teak oil on one end to a short oil varnish (more resin, less oil) which is a hard surface, to a long oil varnish (less resin, more oil) which is more like a spar varnish that stays flexible, but easily marred.
BTW its drying oils that you have to be careful about rags. Lots of people think of motor oil spontaneously combusting, but that's not correct, its drying oils that generate heat if there is an abundance of both oil, oxygen and surface area. It's just like curing resin that heats up and it can catch fire. So anytime you use a drying oil, I put the rag into a ziplock back and squeeze the air out so it can't get an abundance of oxygen, then put THAT into a metal garbage can that won't burn down if it catches fire.
All of this is a bit oversimplified, but gets you started on the basics. It's actually a fun one to research and helps to decode what is being put into a particular can.
Edited, Tung not tongue!
