96 VW Jetta 2.0L 127,000Miles

Several things may be wrong here, but it doesnt sound like anything to major. When was the last time the oil was changed/filter was installed? Whoever installed the filter may have overtightened your filter, damaging the seal. Alternately, the gasket from the old oil filter may have stuck to the engine where the filter mounts instead of coming off with the filter, allowing oil to leak through the openings created by the filter gasket not making contact with the engine. The only way to know for sure is to take the filter off, and if you are going to do that, you might as well change your oil again. Remove the filter like normal when you change your oil. Prior to installing the new filter, clean the area that the filter mounts to the engine. You may see part of the old gasket/seal stuck to the motor, you may not. If anything is remaining there, remove it. Make sure that the area where the filter mounts is free of any debris or leftover oil, and then lubricate the new filters gasket/seal with clean engine oil, and screw in the filter with your hands! Do not use a filter removal wrench! You dont want the filter to loose, but you dont want it very tight either. Just right in between. hope this helps!

I thought it might be that, but the oil leak is actually from a seam in the metal piece the filter screws into. 1 seam towards the top from the filter gasket. It's not from where the filter is actually making the connection.

Sounds like a crappy situation. Let me take a look at my engine. That will help me understand better. Ill get back to ya soon.

Wow. I just had the same thing happen to my 95 2.0. Oil is leaking from the top of the oil filter housing like crazy. It is in the shop now, so I hope that their is not much damage. I had to add oil to get it to the repair shop.

Don'T worry. Same thing for me 2day. Oil cooler o Ring ( seal ). It cost me 6$. And 20min to change
if you have stopped engine immediatly aftr you oil presure have flashed. U'r probably ok :)