Yes circular thing on the block is the fuel pump.It needs the crankcase pulse to operate, that line could come in from behind the pump thru the shroud or from a different point. That line could be the point of fuel entering the crankcase.Most of those pumps are under 50.00.I have a few spares laying around, they are pretty universal...if I suspect a bad pump,Ill zip tie a spare to the original and hook it up and see if my oil stops getting diluted.