Time series ground deformation monitoring and reservoir parameter inversion are crucial for the dynamic assessment of oilfield resources and sustainable exploitation in an oilfield. As one of the regions with the richest oil reserves in China, the oilfield areas in the western Qaidam Basin are selected as a typical study area. Firstly, we used SAR images collected by the Sentinel-1A satellite from January 2021 to December 2022 and applied the Multidimensional Small Baseline Subset (MSBAS) method to obtain vertical and east-west deformation measurements. On this basis, a nonlinear Bayesian inversion method was applied to model the shallow reservoir in a series of complex deformation areas, based on a single-source model and a multi-source model, respectively. As a result, the ground deformation monitoring results obtained by long time series InSAR clearly reflect the uneven ground deformation caused by the oil extraction and water injection operation process. There is slight subsidence in the Huatugou oilfield, while significant uplift deformation occurred in the Ganchaigou oilfield and the Youshashan oilfield, with a maximum uplift rate of 48 mm/year. Further analysis indicates that the introduction of the 2D deformation field helps to improve the robustness of oilfield reservoir parameter inversion. Moreover, the dual-source model is more suitable than the single-source model for inverting complex deformation reservoir parameters. This study not only fills the blank of InSAR deformation monitoring for the oilfields in the western Qaidam Basin but also provides a theoretical reference for model and method selection of reservoir parameter inversion in other oilfields.