I have an '87 740GLE wagon with over 325K and the oil light has been flickering for at least the last 100K. Wire insulation in the eng. comp. sucked big time -crumbling to the touch. Check the insulation along the length of the oil sensor sending wire. Is there any bare wire? If so, is it capable of touching any nearby bare metal when the car is running, vibrating, bouncing, etc? This unintentional grounding could be causing an seeemingly erratic flickering Alternatively, the oil pump could be failing (not real likely) or maybe you're just low on oil.
I've had this car for about 15 years but that doesn't qualify me as a volvo technician, so please don't rely too heavily on my suggestions. To the numerous posters on this forum with much more experience than I, please don't hesitate to take me to task for bad advice if I am guilty of such.
cheers.
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