Tea tree oil is a clear essential oil derived from the leaves of Melaleuca Alternifolia, which is native to Australia. It has well-known antiseptic, antifungal, and antibacterial properties. It's effects on molluscum contagiosum, though, are yet to be determined. Studies are still ongoing to try to determine its possible uses for some skin problems. A major problem with tea tree oil is that it is a toxic and harsh substance.
Tea tree oil is highly toxic, and should NOT be taken internally. It has been reported to cause drowsiness, confusion, hallucinations, coma, unsteadiness, weakness, vomiting, diarrhea, stomach upset, blood cell abnormalities, and severe rashes. Using it on the ears may cause hearing loss.
Application of tea tree oil to the skin is not without its problems either. It can cause severe allergic reactions, rashes, and eczema. Even when externally used, it has caused death when tested on animals in undiluted form.
If you want to use tea tree oil, please make sure that you know what you are doing, and handle it with care.
Tea tree oil definitely has antiseptic and antibacterial properties, but its effectiveness on molluscum contagiosum is yet to be determined. It is very toxic and can result in severe skin reaction. If you want to try it out on your molluscum, I cannot tell you that it will not work, but the severe side effects may not be worth it.
My Rating for Tea Tree Oil: 5/10