If I look at your draft tube, there is a baffle in there. If you look down the tube you will see little holes. Those holes feed into the space between the inner tube and the outer tube. This is how gases are supposed to flow around to the side tube. That top ridge should provide a seal between the two tubes. It appears that someone has torn and bent that lip and created a direct passage to the outside tube. That is probably why you are losing oil.
