I was just wondering if its okay to use smiths honing oil to oil the joints of my sak?

I wouldn't advise it. Honing oils generally contain other chemicals to aid with sharpening and protecting the stones. Those chemicals may not be so good for the metal (or plastics) used in your SAK.

Stick with a proper multipurpose oil or silicon lubricant.

I looked on the back of the bottle and it said that its mineral oil based. I have heard that people use mineral oil to oil their knives. what do you think of that?

I just picked up some sewing machine oil today and it works great! thanks for the advice.

Mineral means it's normal oil derived from crude oil.. as part of the process to turn crude into gasoline/petroleum.

So what they really mean is that it's basic plain oil with some extra chemicals mixed in.

Yep that's the best stuff to use. Victorinox recommend oiling your knife every 6-12 months depending on how often you use it.