Outbound rule "DenyWebSites" is setup correctly to block outbound internet traffic over port 80. In the screenshot it states, "Associated with: 0 subnets, 0 NIC's", so you need to associate the NSG to Subnet1.You can associate or dissociate a network security group from a NIC or Subnet. Reference:
https://docs.microsoft.com/en-us/azure/virtual-network/manage-network-security-group