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Your fuel gauge works just like an ammeter the more current it passes, the higher the reading will be. Your sender is a variable resistor , the higher the fuel level, the more current it passes to ground( and pulls through your gauge/ ammeter) the higher the reading will be. You have a short somewhere between the gauge and the sender. If you disconnect the wire at the sender and the gauge drops then you have a short to ground in the sender itself. If it does not drop then you have a short somewhere up the line.
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