There are only two ways the engine oil can rise on the dip stick . The coolant is leaking into the sump. cracked head, faulty gasket, or leaking expansion plug. or fuel bypassing the rings and entering the sump. If it is coolant the oil will be a creamy color .
Also it could be leaking from the valve cover gasket in which you replace the gasket.
An engine does not make oil, but it can spill the oil that should be inside. You could have an oil leak, which means that oil will be leaking from either the front or the rear oil seal. The front oil seal is just behind the crank pulley, the one that drives the fan / alternator belt. If oil is leaking from there, suspect the front seal.
If you have oil leaking from the bell housing, that the the bell shaped metal thingy between the engine and the gearbox. you can suspect the rear oil seal.
If you inspect the engine and see oil leaking from the oil pan under the engine, you have a leaking pan gasket. This can usually be solved by tightening the pan bolts, a whole lot of bolts underneath the engine.
Finally, and this is probably the worst, if you see oil around the breather pipe that goes from the valve cover on top of the engine to the gas intake system, you have leaking compression, that means either the valve stem seals are leaking or the compression rings are finished, and you will have to have the engine overhauled, or at the very least have the cylinder head overhauled.
If the rings are suspect, you will also have excessive smoke out of the exhaust when you drive, especially when you accelerate. Check the exhaust for signs of wet oil.
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