Oracle Linux: SSH Connection Failure Due to Missing /var/empty/sshd Directory

Applies To:
Oracle Cloud Infrastructure
Linux x86-64

Symptoms:
Attempts to establish an ssh connection to the instance fail with the following error
:ssh_exchange_identification: read: Connection reset by peer

On the server side sshd service is unable to start and produces this message:


$ /usr/sbin/sshd        

Missing privilege separation directory: /var/empty/sshd

Cause:
The system directory /var/empty/sshd which is required by the ssh daemon for privilege separation is missing. Without this directory sshd daemon cannot start and therefore no ssh sessions can be established

$ ls /var/empty/sshd                                                                                                                        

ls: cannot access /var/empty/sshd: No such file or directory