Black smoke is usually not oil bieng burnt but deisel not bieng burnt correctly, the throttle position means that the problem may be hair line and therefore opening up under the extra compression forces at higher revs, however oil in exhaust could be head gasket or rings (oil getting up through rings) could be scored bores, cracked piston, crack in block etc...........I know it does not sound good, but if oil is getting through into combustion area then normally something is seriuosly wrong. If you are plannning on looking into this yourself you could do a combustion test to see if the integrity of each cylinder is OK (however as the problem occurs at higher revs, this may not be visable by just turning engine over a few turns), it could be something as simple replacing the head gasket, or altering the position of the rings. Check out getting hold of a copy of the engine book as this will details faults and possible causes. My views are purely based on my experience, of which my wife tells me I have very little!!!!
Black smoke in the exhaust often means insufficient air supply. Check out and clean the air filters, if fitted. Also check that the engine has not sucked something in to the inlet manifold and blocked it. Diesels require a huge amount of air. have you altered the engine room ventilation in any way? TRy running it with the engine access hatch opoen - does that make any difference? A diesel can actually create a partial vacuum in a well sealed engine space - as submariners know well! Severe black smoking can be oily as the fuel isn't burning properly. You get the same effect on a gas flame if you choke off the air supply - it burns yellow and smokes.
Can also be caused by a faulty injector pump causing over fuelling. have you changed the injector HP pipes? If so incorrect bore size can upset combustion fuel/air ratio.
Less severe black smoking can be caused by an overloaded engine (drag in the transmission or fouled propellor), or faulty injectors allowing too much fuel into the combustion chamber.
If the engine is burning oil this will usually give blue or white smoke, not black. Does it need frequent topping up?
Black smoke can be caused by the engine being overloaded. Is this a new problem or has it always been like this? If it has been ok in the past. what condition is the prop? is it fouled or damaged, is there a lot of weed on the hull. If it's always been like this, is the correct prop fitted?