Pressure in a tank of water increases at a rate of 0.43 PSI per foot of depth. Call that Rw. The pressure due to the oil increases at a rate proportional to its specific gravity, so for an oil with a specific gravity of 0.8 pressure increases at a rate of (0.8 * 0.43) PSI per foot of depth. Call that Ro.
Call the depth of the water Dw. Call the depth of the oil Do.
Total pressure = (Ro * Do) + (Rw * Dw).
The level sensor gives you the elevation of the surface. Your pressure sensor is mounted at a fixed elevation so you know the total depth of the liquid in the tank.
Total Depth = Do + Dw
That's two equations in two unknowns (Do and Dw).