i bet it's just your oil pressure switch, these go out on alot of ford vehicles. Disconnect the oil pressure sending unit connector and with the key in the run position take a wire and ground the connector(harness side) the oil pressure gauge on your instrument cluster should go to about the halfway point since it's a dummy light and anytime you have more than 5psi for oil pressure it's going to read that you have oil pressure and not fluctuate, here's the pinpoint test though. you can skip the first step since you said the gauge will do a full sweep
PINPOINT TEST C: INCORRECT OIL PRESSURE GAUGE INDICATION
Test Step Result / Action to Take
C1 CHECK THE INSTRUMENT CLUSTER OPERATION
CAUTION: Use the correct probe adapter(s) when making measurements. Failure to use the correct probe adapter(s) may damage the connector.
Connect the scan tool.
Ignition ON.
Enter the following diagnostic mode on the scan tool: Instrument Cluster Active Command.
Trigger the instrument cluster active command OIL GAUGE. Scroll to 0%, 50%, and 100%.
Did the gauge display L at 0%, the middle of the gauge at 50%, and H at 100%?
Yes
GO to C2.
No
GO to C3.
C2 CHECK CIRCUIT 31 (WH/RD) FOR AN OPEN OR A SHORT TO GROUND
Ignition OFF.
Disconnect: Instrument Cluster C220b.
Disconnect: Oil Pressure Switch C103.
Measure the resistances between the instrument cluster C220b pin 16, circuit 31 (WH/RD), harness side and the oil pressure switch C103, circuit 31 (WH/RD), harness side; and between the instrument cluster C220b pin 16, circuit 31 (WH/RD), harness side and ground.
Is the resistance less than 5 ohms between the instrument cluster and the oil pressure switch, and greater than 10,000 ohms between the instrument cluster and ground?
Yes
INSTALL a new oil pressure switch. TEST the system for normal operation.
No
REPAIR the circuit. TEST the system for normal operation.
C3 CHECK FOR CORRECT INSTRUMENT CLUSTER OPERATION
Disconnect all the instrument cluster connectors.
Check for:
corrosion
pushed-out pins
Connect all the instrument cluster connectors and make sure they seat correctly.
Operate the system and verify the concern is still present.
Is the concern still present?
Yes
INSTALL a new instrument cluster. REFER to Instrument Cluster in this section. TEST the system for normal operation.
No
The system is operating correctly at this time. The concern may have been caused by a loose or corroded connector. CLEAR the DTCs. REPEAT the self-test.