If the oil level is fine on the dipstick, but you have the amber "Low Oil" warning light on the dash then yup, it's the sensor. Could also be the connection to the sensor. May be worth taking the connector off and cleaning with some contact cleaner first. Quick job and could save you some money.
If that fails then replace it. They seem to be on eBay from £15 - £100+, but no idea of the quality. You can also put in a parts request on here via this link and someone from Crewe Audi will price up a genuine part for you, posted.
Buy a quality oil sensor and do an oil change at the same time. If I were you I would take the sump off and check/replace if necessary the oil pump/balancer shaft hex drive ! Just to be on the safe side !