This is interesting, maybe not same, but both my X5 and wife's X3 have M54 engines. The X5 oil light only comes on when there is no oil showing on the dipstick, I replaced the sensor and it didn't improve. The wife's X3 lights up when oil is at half way mark. Is this a codable parameter?

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1988 325is (purchased new) sold
2004 X5 3.0 2005 X3 2.5
2008 X5 3.0 (new to me)