I have no clue what causes this (no other mods except fabric api installed) When sodium is installed this only affects mobs and particles.

heres the same place with exponential fog turned off (the same bug is present in exponential ^2)

Yep exponential and exponential^2 are both completely broken. Should be removed imo.

Exponential and Exponential^2 fog modes require you to disable fog occlusion in the sodium settings menu, as is mentioned on this mod's curseforge page.