That is the crankcase vent.
Oily fume comes out of there.
Excessive amounts of oil is causes by a blown head gasket or worn rings.
Simple check for blown head gasket is too run engine for 10 minutes, shut it down then undo the dip stick.
If smoke comes out gasket is gone.
If you tipped the engine sideways oil comes out of the breather.
If you have overfilled the engine oil comes out of the breather.