Unless they have changed the formula there is no water listed as an ingredient.
[I]8-hydroxyquinoline sulphate 0.3% in a petrolatum, lanolin base[I]
It's not anhydrous lanolin so there is probably some amount of water mixed with it but not enough to get billing in the ingredients list. There are what appears to be little bubbles through the material though. Those may be, in reality, beads of lanolin which are unable to mix with the petrolatum.