As a Marine Surveyor specializing in commercial vessels, I have been including recommendations regarding oily rag handling for years. This always seems to be an issue. I expect that is because people rarely experience spontaneous combustion first hand.
This weekend as part of spring cleanup and preparations I applied oil to the back deck. I used a Cabot product called Australian Timber Oil, which they recommend to apply, let soak, then wipe off excess after 30 minutes or so. The directions on the can said "Danger: rags steel woo or waste soaked with this product may spontaneously catch fire if improperly discarded. Immediately after each use, place rags, steel wool or waste in a sealed, water filled metal container and dispose of according to local regulations". Instead, I gathered up the used rags put into a plastic bag for disposal.
When I picked up the plastic bag containing the rags it was hot to the touch. I opened the sealed bag and smoke was emitted. An infrared thermometer showed 348 degrees on the outside and a digital probe showed pulp temperature of 329.5.
Spontaneous combustion in action!
I filled the bag with water and everything cooled down.


