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There should be a file sagetex.sty in the actual Sage installation which you can copy. See the SageTeX installation guide for its location in the "third (and best) way". Placing this in the "right" place as described there should solve your problem. I hope!

It's possible that your solution should work too, but it's harder to hide those sty files than it seems.

Alternately, you may have a mismatch in your sagetex.sty files between versions.