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First, the torpedo is the electric ray, a flatfish with the capacity to deliver an electric charge (so not an eel), and to numb the hands (and presumably other anatomic localities) of the unwary.
Our sense of the word torpedo turns on two seemingly antithetical objectives: a) to blow up, and b) to render numb. Its root, however, is in the Latin torpere, to make dull, from which we get the English word torpor, meaning inertia or lethargy.
Torpedo in the incendiary sense has been used at least since the 18th century to describe all sorts of things that go bang, including nonaquatic entertainments like the exploding caps one might throw at the floor. So the OED’s various citations map out a range of senses, from mines and bombs to smaller bits of devilry once common on playgrounds in a simpler age.
Torpedo in the druggy sense dates at least to 1940. The OED cites Chandler’s Farewell, My Lovely and the usage “yellow torpedoes,” referring to a particular form of narcotic. More recently, Urban Dictionary points to torpedo as a joint “laced with pcp.”
(By the way, one sense of torpedo missing from the OED is the torpedo sandwich, also known as the sub or submarine. Made on a long roll, this torpedo is honor-bound to be overstuffed with comestibles, its objective only to satisfy, and maybe to render blissfully dull, too.)