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Oil Leak Around Sensor

I have been having a problem with an oil leak around this sensor port in my Jetta, I’m not really sure which sensor this is, and am hoping that someone else can identify it so I can get an idea as to how much of a problem I am really going to have with it. The sensor itself is covered with a rubber hood that covers the connector, when I start the engine, it blows this hood back, revealing the blue plastic of the sensor.

I have a 1997 VW Jetta GT with the 2.0 liter A series gasoline engine.

I’m not familiar w/your car, but that looks like an oil pressure sensor to me. If so, it is for the dasboard oil pressure guage (or idiot light). You could prove it if it has an electrical connector you can disconnect, as then the dashboard guage wouldn’t work or the idiot light would come on. Have you checked to make sure the thing that holds it to the block is properly tighten? It might have just come loose from road vibration. In any event if that’s the only problem, it looks like a simple fix to replace it. Be sure to monitor your oil pressure and make sure the oil level is ok until you get it fixed.