This is because in cake you have what are called emulsifiers which stops the oil from separating out so it stays in the cake.. if you added too much it might come out of the cake when you are baking it though.
The oil gets mixed with the water because the cake powder and the eggs have proteins and other substances (called emulsifiers as Ciara has said) that can make it happen. This is because proteins surrounds the oil and make them soluble in water.
It also depends on the quantity of oil and water. If you add more oil than water is the water the one that gets dissolved in the cake mix.
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