I've noticed that water renders in front (nearer to the player) of particles even if the particles are closer. This happens even if the water is further away than the renders distance allows you to see.
How I noticed it and one way to recreate it: I was farming flint by pillaring up using gravel and then digging my way down. I had a pretty low render distance and could not see the ground. When I started digging I could see the lakes below through the digging particles.
It works on lower distances too.