88 Wrangler oil in air filter

I just bought a 88 Wrangler Jeep with Automatic and a 4.2 six cyl. I am getting oil comming out of the air cleaner snorkel. It has Pulse air system and the tube comming out of the catylitic converter is rusted and disconnected, the other going to the exhaust pipe is connected and goes to the air cleaner. Both pipes go to the air cleaner with one disconnected. Could this cause the oil to go to the air cleaner anyone know? Can i close these tubes and bypass it.