My guess would be that the oil is coming from the oil pump.
Pull the left crank case cover off and you'll see the oil pump and the front chain sprocket.
If you have a partsfish.com account follow the "Don't know your part number" link,
go to the 1979 CB650 page and select LEFT CRANKCASE COVER OIL PUMP.
Or go here, donwload part 3 of the CB650z parts manual and look at page 10.
http://www.honda4fun.com/spaccati/spaccati.htmlI would attach it but the server said it was too big. (2.3Mb)
It's not all in English but you can make out the part names.
Scott