Okay I have a 2001 A6 Quattro with 134k miles and 6mt. I have had a cel on for an o2 sensor for a while but recently the car has been having sudden lags in power while driving as if something is slipping. I though fuel system problem and started by replacing the fuel filter.
Then yesterday I looked in my mirror and saw thick black smoke. Pulled over expecting it to be from the exhaust, but nothing. checked fluid levels and all are good. Start going again and no smoke until I hit 4th gear and smoke returns. Continues in 5th and 6th gear. Downshift into 3rd or lower and the smoke stops but the lagging continues and gets continually worse. I drove the 80 miles home in 3rd gear and wasnt sure if I would make it. I thought it would be the clutch but the RPMs dont increase when the slips happen. Also the ESP light and the ABS light come on when I feel the slip occur.

I would just like to have an idea of what the problem could be before I start taking it apart. Any help would be greatly appreciated.