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Dear w9kir,
Hope you're well. The fuel pump sending unit "retainer" (Part #1325236) costs about $12, at a Volvo dealer. A removal tool - which if memory serves is available - is certainly going to cost more than that. Volvo-specific tools rarley are cheap: once you use it, it is unlikely you'll again need it.
Onkel Udo II's post proves my point. The IPD tool is $24 plus shipping (likely to be $10-12). You'll thus have spent $34-36, to save replacing a $12 part.
Thus, I'd get a replacement "retainer", before going further.
Rather than using a punch, get an 8"-10"-long strip of wood, that is 3/4" square or 1" square. Put the narrow edge of the wood strip against one of the "teeth" on the retainer ring. You might apply a penetrating oil (Kroil, PB Blaster) to the top of the send unit, to lubricate the plastic. Allow the oil a few hours to work. Then, hammer on the block of wood. I'd guess the retainer ring will move, albeit grudginly at first.
If the retainer does not move despite repeated whacks with the wood block, cut the retainer using a hacksaw blade. Be careful not to cut into the edge of the send unit's top. When you install the new retainer ring, lubricate its threads with some petroleum jelly (vasoline). That will ease retainer ring removal, in the unlikely event that is needed.
Hope this helps.
Yours faithfully,
Spook
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