Oil gauge won't stay up

If your oil is full, it's most likely electrical. If it's not electrical, then it's most likely something like a crack in the pickup tube, sucking air if I had to guess.

Well the warning light is supposed to come on if any of the gauges display a dangerous condition, such as no oil pressure.
You may have a faulty sending unit for the gauge, or a wiring problem, or the engine may actually be loosing oil pressure when the gauge drops.
You could replace the sending unit as a test, or have someone check the oil pressure with a mechanical gauge.

On 1999 Jeep Cherokee 4WD 4.0L MFI 6cyl ...
With Transmission model AW4:
-Service change only - 2 quarts.
- Total refill - 8.2 quarts.

With 30RH transmission: Pennzoil Multi Vehicle ATF

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OIL PRESSURE SWITCH-I'm not sure if this is the gauge sender, though. 1995 Jeep Grand Cherokee 4WD 4.0L MFI 6cyl The Oil Pressure Switch is located: Under hood, passenger side, lower engine area, above oil pan, mounted in engine block.

I'm assuming the engine is still running and no engine noise has occured due to loss of oil pressure, and it is just the gauge that is not reading? If so, the oil pressure switch that is located on the camshaft sensor, could have a bad connection or the oil sensor will need to be replaced. The oil sensor is located on the left side of the engine and is mounting horizontally on the camshaft sensor housing.

generally it turns outto be one of three things 1. bad sending unit (switch) 2. stuck pressure relief valve in pump (not often) 3. bad gauge head (less than not often)(rare). You can attach a mechanical gauge to the engine and read actual oil pressure (attaches right where sender screws in). That will tell you if the problem is inside the engine or in the gauge system. If it turns out to be inside the engine you can add Marvel oil...many times the problem will clear up in a few days.
Be aware though that very high pressures can cause the oil filter to split or the seal to leak.Most quality filters are tested to about 100psi.(no idea about cheap ones if the test them at all)

Low oil pressure can and will destroy your engine. Check the oil level. If it's full or just a little low (1quart or little lower) then you have a serious problem already. If it is lower than a quart and a half, re-fill it and check pressure. If it's OK, then find the leak and fix it. If after filling it pressure does not return to normal then you already have a serious problem. have the actual pressure checked with a mechanical gauge and proceed from there. (likely bad bearings) If main bearings are involved, unless you remove the engine and re-grind the crankshaft and clean out the oil passages, you are wasting your $. Usually cheaper to replace the engine and more reliable as well.

The first thing I would definitely do there is change the oil. Used oil tends to loose lubricity and becomes thinner than it was when in the container. When hot, it becomes even thinner and will cause a drop in pressure.
Most jeep engines hold around six quarts of oil, so by adding what you did the new oil helped a bit but cannot correct the problem.
I would change the oil and use either a 20w50 oil with a pint of Marvel oil, or change to a good synthetic with a container of Lucas additive. It is possible that whatever oil you have been using is causing a carbon buildup that is beginning to block off the pump pickup screen. Either of the above suggestions will help with that. In engine oils, price is important...cheaper oils are high paraffin base which causes deposits to form.
You don't want that in your engine. Only exception is Wal-mart store brand oil which I believe is Quaker State (re-packaged). If you opt for a synthetic, it's not a bad choice and is cheaper.
Make sure you use a good quality filter. The filter is what keeps the oil clean and useful during its lifespan.
One note... If there is any tapping or knocking inside the engine, that is caused by internal bearing wear and should be corrected immediately. No oil can compensate for internal pressure loss and if caught early, can be repaired. (otherwise, later, engine will need to come out and be overhauled or replaced.)
Any pressure problems can be verified by installing an external mechanical gauge on the engine. That is the only way to know exactly what is going on with any degree of accuracy. (dash gauge is electro-mechanical).
good luck

Same part...make sure you get one for gauge, not idiot light though. If the engine has any knocking or ticking when pressure drops do not drive it and have a mechanical gauge installed to check actual pressure. Parts often have different names for same item...your driveshaft is actually called a propeller shaft!!!

It's probably the oil pressure switch. I have to replace min every 5 years or so because it does the same thing. Mine is mounted next to the filter on my '93. It's a little black thing with a plug in the end. You can get one at autozone for about $40.