1982 Volkswagen Rabbit Engine smoke mostly goes away when A

Hi, I have a 1982 diesel rabbit with the 1.6L engine in it. It smokes pretty badly. It's a bluish smoke so I'm assuming it's oil. But I could be wrong. When I turn my air conditioner on, the smoke basically goes away. It'll puff a small amount when I accelerate but thats it. When I cut the AC off, it goes back to belching smoke. What could cause this? I don't know much about diesels... Thanks! Josh