Let's see if anyone can solve this problem?
I had last given my Series 1 XJ6 a run about a month ago. Immediately following this run I changed the oil and filter - my car has the old paper element type filter.
Ran the car in the garage afterwards and all looked good.
Come today, start the car all fine - my gauge usually shows about 50psi when cold, then settles to just over 40psi when hot. Drops to about 20 on idle.
After a couple of miles, the oil pressure gauge starts to climb - up to 60psi, then keeps going off the scale! I pull over and let the car idle - pressure drops a bit but still very high.
Inspect the engine bay - no apparent problems. Car is running fine, so I return home. On the way the gauge drops back to normal, then climbs again - does this a few times.
At this point I am worrying whether I assembled the oil filter incorrectly, but reason that this should not interfere with the oil pressure readout.
Once home I change the oil pressure sender for a good spare - still reading 60+psi .
I change back to the original sender and I all of a sudden, I find the problem.
Q. What was the fault ? (I know the answer, but want to see if anyone can guess)

 

Signal wire earthing out near the sender.

 

I concur with Grant!

 

I had similar issues, except my pressure readings were fluctuating to the low side. Cleaned and tightened the signal wire connector and now just perfect.

 

This is close, and after I read the response, I thought that I must have made a mistake with my diagnoses, and that there was a loose strand of wire earthing on the sender unit.
A wire strand earthing will indeed show similar symptoms.
But what caused my symptoms was a make/break in the sender terminal wire. Here is why.
Inside the sender unit is a set of contacts and a bimetallic strip. As oil pressure rises this causes the contacts to close. If they remained closed the reading would climb off the scale (+60psi.) A heater wire surrounds the bimetallic strip and heats up as the contacts close, causing them to open again. The gauge is constantly getting feedback from this closed/open loop to show the pressure. In a terminal make/break situation not enough current can flow to heat up the bimetallic strip. So the contacts stay closed but sufficient signal may get through to earth to make the gauge read high.
Either way, the remedy is the same - renew the terminal connector and all is well.
Thanks to all who thought about this. John