Peugeot Repair Questions? Ask a Mechanic for Answers ASAP
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I'd 1st suggest measuring the actual oil pressure with separate mechanical gauge - this can be plumbed into the engine via the current pressure switch port - if you use a Tee piece you can keep the pressure switch plumbed in as well and so see if the low pressure light corresponds to a low pressure reading.
As its intermittent and you have no rumbling or rattling noises from the engine its likely to be an electrical fault so 1st check the connection to the pressure switch is bright and clean and check back along the switch wiring for any signs of damage to the insulation
As if the wire is grounded out at any point then this will also turn on the light.
if this is all OK and the oil pressure is at least 1.3Bar ( 20psi) at hot idle then replace the switch
If you do have a low pressure reading and to turn on the light it will be very low about 5psi then replace the oil pump and ensure that the pump pickup in the sump hasn't come loose or is blocked
looks like its on the bottom of the oil filter housing
see the attached image - item 20
still you can pick up a good used engine for about £1000 (less turbo) that will come with a 30 day gaurentee
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