Are you accessing the oracle server with OPENQUERY or by using a 4 part name?

Try both - this may clue you into the issue. If openquery works but 4 part name queries do not, it could be that the ODBC driver is running out of memory. This could mean that you need to use the -g startup parameter for SQL Server to allocate more memory to non-SQL processes within SQL Server.

If neither works, I would completely uninstall the Oracle client and reinstall it. Make sure you reboot afterwards.