Moisture content is also considered as one of the contaminants in used lube oil since virgin lube oil does not contain detectable amount of moisture. Water contamination is an economic concern for everyone dealing with used oil because of the added cost associated with handling the water (e.g., dehydrating step in re-refining). In our proposed treatment process, however, a certain amount of water may be needed to create an optimum water/oil ratio for perfect emulsion. Thus, we have to measure the water content in the original used oil sample, sometimes we may need to add some water (distilled water or other waters with specific properties) to make the sample needed for the treatment. However, laboratory methods for quantitatively determining water content in oil are mostly expensive (such as Karl Fisher method), time consuming and give a poor accuracy result, such as the distillation method. Hence, a convenient test kit “HydroScout™” developed by Dexsil Corporation is used in the study. The HydroScout™ system is designed to accurately and quickly measure the water (especially the dissolved water) content in used oil (or in other petroleum oil products). The test uses a specially formulated CaH2 reagent to quantitatively convert all water contained in the oil sample to H2 gas. The reaction is carried out in a sealed tube and the resulting pressure is measured using a specially designed meter. The results are displayed directly in percent and it takes only two minutes to finish one measurement.