SSH Permission denied (publickey) on Password login

I am getting a very strange behavior...I am running an Ubuntu 22.04 on a newly created oci instance (arm)

I've just created the instance a few minutes ago, i did no changes and i try to setup Password ssh (as key ssh is the only possible way to ssh into the machine when you create the instance).

I've set the password for the ubuntu account.

passwd ubuntu

I've enabled PasswordAuthentication yes in /etc/ssh/sshd_config.

I've restarted sshd both with systemctl restart sshd and systemctl stop sshd wait a minute systemctl start sshd.

And for some whatever reason I am unable to login.

If i do ssh ubuntu@my_machine i get "Permission denied (publickey)".

I know for a fact that this is the way to do it, I did it in the past and i saved the "traces" of what i did then and it was the exact same thing, and that time it worked.

Also, based on this "official" procedure from oracle, this is the way to do it...

OCI Compute – How to Enable Password Based Authentication on Linux Instance (Doc ID 2931479.1)

I don't think it has to do with my computer. I tried from another one and i get the same thing. I also tried from another oci instance to ssh into this one and i get the same thing.

What am i missing here?