The fires on the ship are clearly not burning oil, but gas. Otherwise, there would be thick black smoke and pouring water on it from buckets would result in an explosive spread (for that same reason one should never try to extinguish burning fat in a frying pan by pouring water on it).
Addendum: the oil on board was aviation fuel, not crude oil. There would have been no other way to put the fires out than to use water. I am not sure the original criticism is valid, particularly so as the Chief Engineer was the technical adviser on the film.
At the end of the movie, the Judge states that the crew collectively wished that the Ships Red Ensign was to be presented to Preston, known as Yank, in fact, the crew asked that the Red Ensign be given to Second Officer Arthur Godfrey Hawkins for his leadership in navigating the Ship and getting the crew home.