Sounds like the oil pump cable is sticking or the oil pump and the cable is not in the correct spot meaning it is allowing to much oil. There is different marks to put the cable at to adjust for how much oil to send through the system.
Click on Polaris at this link and then click 1996-1998 Polaris Service Manual. The 1998 700 SKS should look a lot alike your setup. Check the manual on how to adjust it and where the notches are on said lever. Also I would use some graphite spray to lube the oil cable & throttle cables just to be safe as well.