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There are three possibilities here. A bad Dash Gauge, a bad Oil Pressure Sending Unit or a bad Oil Pump. I don't think it's the oil pump. The only way to check this out properly is to remove the OPSU and install an outside oil pressure gauge. This will tell you what the actual oil pressure is. If the reading is normal and steady, then the pump is in good shape. Since you have the OPSU out, install a new one. That is what's most likely wrong. If the dash gauge still goes nuts, then you'll need to replace the dash gauge. Also make sure you are using the correct oil filter. Might be a good idea to switch brands. Purolator & Wix are excellent filters.

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Q: What would cause your oil pressure gage to read low at times but normal at other times- 98 wrangler?
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