Shunbei Oilfield is characterized by substantial heterogeneity and a complex oil−water relationship. The water-oil interface is dynamically changing, and it is a crucial parameter for reserve calculation and evaluation. The main purpose is to analyze the effect of fluid flow in multi-scale media on the water-oil interface. It is well known that the fracture-cavity reservoirs have well-developed fractures and karst caves, and their distribution is complex in Shunbei Oilfield. This paper presents a way to simplify the fracture-cavity system first, then uses a unit of oil wells as a system to study the water-oil interface, which avoids impact on the water-oil interface due to oil production. A detailed step by step procedure for solving the semi-analytical solution of water-oil interface in a fracture-cavity reservoir by using an explicit algorithm and a successive steady-state method is presented. The solution can be used to investigate water-oil interface behavior. In this paper, we validated this method with the actual data for a relatively similar actual reservoir. Sensitivity analyses about the effects of the main parameters including production rates, cave volume and initial oil−water volume ratio on interfacial migration velocity are also presented in detail. The water breaking time of oil wells is fully investigated. The water-oil interface movement chart under different development conditions is established to predict the water-oil interface in the late stage of oil well production and extend the waterless developing period. Being based on this chart, a water breakthrough warning can be realized, and oil recovery can be improved. The findings of the research have led to the conclusion that the rising speed of water-oil interface is proportional to the production rate, on the contrary, it is inversely proportional to cave volume and initial oil−water volume ratio. As well production goes on, the water-oil interface rises at different rates. After the well is put into production for one year, the water-oil interface rises by 16.38%, 12.56% and 4.24% according to the condition that production rate is 10%, the initial oil−water volume ratio is 0.7, and the cave volume is 100 × 104 m3. This method is not only suitable for any period and any well type in the development of Shunbei Oilfield; it also has the function of calculating the real-time water-oil interface of a single well and multi-wells. This new method has the characteristics of easy calculation and high accuracy. The method in this paper can be further developed as it has great applicability in fracture-cavity reservoirs.