you are right, that does not seem right. The o ring would have to be able to stop fuel from seeping out across the screw threads and leaking out, which it cannot do if its at the bottom of the needle area. I would think it would have to be between the threads of the screw and the head of the screw, on a flat / shaft section.
the o ring may be dried out and in need of replacement.
Last edited by KCW; 05-05-2018 at 07:38 AM.