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WHY WHY WHY

carb or tank?

First things first. Is it the carbs or gas tank? To determine is not the tank buy or borrow a portable tank and run it on that. If the problem goes away it’s the tank. If not it’s the carbs. Sound like you need to clean the carbs. Good luck.
 
Holy cow - 32:1, do these things really need that much oil? My little 200cc KTM enduro (makes 41hp and is a very mellow, torquey engine) runs just fine on 50:1 full synth. Some guys run 100:1 amsoil, but that's scary.

Sleds and my seadoos inject VERY little oil. I notice my '87 150 merc seems to use alot of oil, based my estimate of all of about 2 tanks of gas I've run though it.

I'd agree that smoke is better than a rebuild, but too much oil gums stuff on on anything with a powervalve - rotax or a bike. I still don't know much about these mercs. My guess is if it ran good on 32:1 on 1990's oil, it will run 40 or 50:1 on a good semi synth. I do love the that smell though!
 
32 /1 ratio is called for when you plan on running your rpms upto at least 7500 i.e mercury racing products 2.5's 245/260/280s or a hotrodded motor.
Back in the day I'd would burn atleast 30gals of mercs premium plus a season.
 
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