How does Sanji produce fire in Water?
As usual, Oda Eiichiro has a "creative" explanation for that too! Oda blatantly disobeys the Laws of our world in One Piece.

In SBS Volume 44, when asked how Sanji could beat Jabra by heating his leg, without burning it, Oda's response was:


  Sanji's leg is not hot!! His heart was burning so much hotter!!


If asked your question, he would probably say something like:


  Learning Haki, spending 2 years chased by Okamas, and being separated from ladies, especially Nami-san and Robin-chan, has made his heart burn much hotter!!! Even water cannot extinguish his burning heart!!!


I know, it doesn't feel satisfying, but this is how Oda-sensei's "explanations" usually are!