I worked for many years in the maritime industry where the practice is common. Why? Waste oil tanks take up valuable space otherwise occupied by fuel or revenue generating cargo and offloading waste oil is EXPENSIVE.
The waste oil is dumped in truly HUGE fuel tanks where the percentage of waste oil to fuel is miniscule. The last ship I was on was 168 feet and powered by two Detroit 16V-149 engines (About 900 HP). I don't know how much oil they held, but I doubt it could have been more than 60 Gallons per engine. Call it 100 Gal per and thats 200 gallons going into 6 tanks totalling 68,000 gallons of diesel fuel. That's something less than half of one percent.
That's for a pretty small ship. I'm sure the percentage goes down substantially as the ship gets bigger.
This was all accomplished via a dizzying array of pipes, manifolds and tanks, and was (is?) perfectly legal.
Any other details I don't know. I drove the thing and thanked God I had Engineers onboard.
Rick