No, it won't leak somewhere else unless there is a problem.
What you're getting is just "splash" from the oil returning to the reservoir as it circulates. It has to turn a corner there and the oil goes both directions.
Just replace that cap with a regular old black iron 3/4" pipe cap. The bolt jammed in there isn't sealing.
Like everyone else has said, that is exactly how it's supposed to be except for the leaky vent on the cap.
You can make another rod for originality's sake, but there is nothing wrong with it the way it is.
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