Pouring water on an oil fire is a quick way to cause almost explosive results. Since water is denser than oil, it quickly sinks to the bottom of a container, heating up as it does. When the water reaches its boiling point, it evaporates and expands as steam. That phase change involves a huge change in volume, a fact made especially clear in the video below. The steam expands and rises, throwing droplets of oil upward and outward. These smaller atomized droplets are easier to combust, which, in the case of the video above, causes a veritable cloud of flames if a fire has already started.
(Video credits: The Slow Mo Guys and N. Moore)
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