REVEAL THE ANSWER
George said: You will boil me in water. The fairies were faced with a dilemma. If they boil him in water, that would make his statement true, which means he should have been fried in oil. They can only fry him in oil if he makes a true statement, but if they do, it would make his final statement false. The fairies had no way our of their situation so they were forced to set George free.