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That is the CMP or Camshaft Position Sensor. Driving it can and possible WILL hurt the engine eventually. The Squeaking is caused by the gear train being worn out. The CMP in this engine is tied into the oil pump for the vehicle. If the CMP Geartrain was to fail or seize (the reason why its beginning to squeak.) it will stop the oil pump and no oil will be fed to the vehicle. The danger is here, that on this vehicle when the Oil Warning Light comes on, the engine is usually damaged beyond repair.

See Related question on how to change your CMP

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Q: 2003 Taurus 3.0 engine that has a chirping noise coming from a sensor on top of the engine block right in front of the bell housing What is this sensor for and will it hurt to drive it?
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