We investigate the laminar flow of two-fluid mixtures inside a simple network of inter-connected tubes. The fluid system is comprised of two miscible Newtonian fluids of different viscosity which do not mix and remain as nearly distinct phases. Downstream of a diverging network junction the two fluids do not necessarily split in equal fraction and thus heterogeneity is introduced into network. We find that in the simplest network, a single loop with one inlet and one outlet, under steady inlet conditions the flow rates and distribution of the two fluids within the network loop can undergo persistent spontaneous oscillations. We develop a simple model which highlights the basic mechanism of the instability and we demonstrate that the model can predict the region of parameter space where oscillations exist. The model predictions are in good agreement with experimental observations.