Fluid of a constant density has a pressure distribution that increases linearly in the vertical axis: P1 = Po + ρ g h1
In reality the density of any fluid will increase with depth and pressure but this will not be required to understand the following.
The most important part of the equation above is the last term that represents the variation in pressure due to height. The other two pressure terms are to indicate a final pressure and a reference pressure. Often the Po term will represent atmospheric pressure but this does not necessarily have to be the case. It is just in the equation to identify the starting or reference pressure. In the figure you can see that Ph could represent the starting pressure. Then you would either add or subtract ρgh from Ph to find a pressure below or above Ph.