Use oil designed for motorbikes and NOT cars! The oil for bikes is designed to work with wet clutches to prevent clutch slip. Halfrauds do a good range and it's cheap enough. I use their own 10w 40 semi synthetic and change it very regulary without any problems so far. Also used it in both my Husaberg motards without any problems.
SOURCE: 110cc pocket bike carberator
That tube would be the overflow tube. Your carb float is sticking open and allowing fuel to flow in constantly. You need to take carb apart, clean needle valve, and inspect or replace carb float.
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