Question

How to separate oil from water?

Answer 1

Time. Letting the solution settle should allow most of the oil to float on top of the water and therefore can be skimmed off but this would still have water which you can then remove by boiling the water off, not so much with heat but with a vacuum. The water that you've skimmed the surface oil from will still have some oil dissolved in it, if you want to remove that oil, you'll need some chemical reactions, perhaps mixing in ethanol which is polar and combines readily with the water, this should cause the water and oil to separate more. Ultimately, you could distill the water out but of course that takes energy.