(see updates at the bottom)
My bike uses Shimano hydraulic disc brakes. I can't find any markings on the calipers or handles, but the manufacturer's website says they're BR-M315.
Over the past few months I've had issues with the rear brake: very low braking power, definitely not enough to lock the rear wheel up, and horrific squealing when coming to a stop. I've now gone through three sets of (resin) brake pads; each time I've followed this procedure to clean the disc up:
- pour boiling water on it to dissolve any grease or oils
- scrub it while using dish soap
- apply automotive brake cleaner and wipe it off with paper towels
- apply isopropyl alcohol and wipe if off with paper towels
I was also careful to bed in the new brake pads. Each time it's fine for around 2 weeks to a month (200-300km), but after that I end up with the same result.
The bike uses a belt, not a chain, so accidentally spraying oil while lubing the chain is not a danger here. I've also wiped the frame parts around the brake rotor and removed the kickstand, since it's right next to the rotor, just in case it was contaminating it. But all this made no difference.
How do I go about diagnosing this? Could it be a caliper leak? I have a spare rotor lying around - would it be worth it to try installing that with new pads, or will that definitely not help? Would it be better to just get the caliper replaced?
Another thought I had is that since the bike uses an internal hub gear, maybe this is a leak from inside the hub shell. But I haven't greased it at all recently, it seems doubtful there'd be so much grease there that it would suddenly start leaking out.
I can't find any markings on the brake calipers or levers, but the manufacturer website says it's BR-M315.
IGH is an 8-speed Nexus, SG-C6001-8D to be precise. But I haven't opened or greased it at all.
edit: I've swapped the caliper for a new BR-MT200; the rest of the system is the same (same brake hose, same rotor). So far it's been three weeks and I've had no issues, so that seems to have been it. I've also opened up the Nexus IGH to do some maintenance and I've confirmed there weren't really any signs of oil leaking from it.
Although FWIW, when looking at the contaminated brake pads, I haven't really seen a noticeable ring of oil like mentioned in the accepted answer. Perhaps the caliper was leaking oil directly onto the disk somehow, or from the bleed port, or ...
A month or so after the previous update above the issue came back. I swapped the brake pads again and also installed brand new rotors, and have had no issues since (it's been six months since then) - so I guess maybe the rotor surface was somehow worn out or contaminated with something even brake cleaner couldn't remove.