Just bought a 2004 XC70 with 148K. Clean, tight. Happy with it for the 400 miles or so the first week. But a few days ago, after about two miles driving it (in fairly heavy rain) it suddenly started a loud and high-pitched squealing. It sounded like it was coming from the rear rather than the front of the car, but not a specific location. I thought it was perhaps a stuck brake caliper, so had my wife, who was driving, stop, back up, then go forward. It stopped but started again at about 30-40 mph. I had her stab the brakes hard a few times but it did not stop until about 10 mph. And from my experience braking does change the sound of a squealing pad. She stopped, I checked the temp of the left rear rotor and it was very hot. Then checked the others and they were all quite hot from stabbing the pedal, and my finger was obviously an inferior thermometer in the circumstances. We started up again and it went away. We completed the 35 mile trip to Coeur d'Alene and drove about town shopping with no incidents few miles on the way to home it started again at about 50-60 mph, I slowed and it diminished and then sped up again and it never came back.

Any ideas? It sounds like a very dry very rapidly spinning bearing.

Of course I am terrified that it might be something in the AWD transmission/drive train, but I'm totally new to the AWD and wonder if anyone else has had a similar experience.

The tranny is about a quart low, and I'm going to Spokane tomorrow about 50 miles away in the 86 T Wagon 85O to pick up a quart of Volvo AW5 tranny oil (none locally). Shifts manually and automatically okay with an occasional slightly heavy shift into second. BTW, Volvo manual with the car says "Volvo transmission oil only," and "Do not mix with other oils." Is this really an issue if you stay within the AW5 oils? I think IPD sells a non-Volvo AW5.