I'm reading a book called "Elemental Magic", by Joseph Gilland. It's about how to special effects. It's an easy to follow book and understand the basics, but the effects requires work.
I haven't finished it, so I can't make you a recommendation or critic yet, but the book is very good so far and, of course, covers a lot of water effects.
I could think of a solution in 3D requiring a distorted torus and an image map moving over it - but the result will look poor in the context of drawn animation.
Yes this is hand drawn. But from work I was looking at last month, there might/could be a way of using some of the newer physics routines to achieve this. It's a little like the buffalo stampede sequence in the Lion King - Disney saw the potential of the then new flocking algorithms and used CGI to great effect.
CGI might be overkill if its just a small water effect but if its more complex or in perspective, then there might be potential for computer assist.