Yes. It is gear lube that is leaking out of the seal for shifting. The seal itself is above the vent plug for filling the drive. Meaning that there shouldn't even be gear lube up there when its sitting on the trailer. I attached a photo for more context. I will replace the seal. But still...
I have a Volvo SX-M drive on my boat and I have been having an odd issue. I keep the boat on a trailer and whenever I go to put it in the water I notice that the drive is leaking oil. The oil is NOT coming from the prop seal it is coming from up under the cover by the shift linkage. The shift...