Compressibility refers to the change in volume or density of a substance under pressure. Water's compressibility is negligible, with only about a 2% change in density up to 7000 psi, making it effectively incompressible for most practical applications. In comparison, oils also exhibit low compressibility, similar to water, and are considered incompressible under high pressures. The discussion highlights that both water and synthetic oils behave similarly regarding compressibility, with no significant differences noted. Understanding these properties is crucial for applications involving fluid dynamics and pressure systems.