Where does this wire go? Found under oil filter.

At least slip heat shrink over the wire where the insulation is brittle. While in-there, if you may later change to an electric fuel pump, consider a 3-terminal oil pressure switch, as I did in my slant (SMP PN PS-64 switch). That can disable the fuel pump if oil pressure is lost, to both protect the engine and stop fuel flow after a crash. My slant engine has a bushing there for a 1/8-NPT switch, so I think the factory hole is 1/4"-NPT. Looks like I added the bushing, but forgot why, perhaps because my SB and BB Mopar engines have a 1/8"-NPT hole so could use the same switch.