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Yes, faulty temperature sensor, really common fault on the JTS engines. Try cleaning the contacts that supply the car with the temperature signal (sensor wiring comes out of the sump), as oil tends to wick through the cables into the connector.
If this doesn't work you'll have to remove the sump, which can be a pain in the ass if you've got a 3.2, or I've made an aftermarket solution:
working-design.co.uk
Feel free to ask questions if you have any.
If this doesn't work you'll have to remove the sump, which can be a pain in the ass if you've got a 3.2, or I've made an aftermarket solution:

Alfa Romeo 939 Series Oil Temperature Sensor - WorkingDesign

Feel free to ask questions if you have any.