Old American bum going around island watering hole (5)

I believe the answer is:

oasis

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'watering hole' is the definition.
(water hole in a desert)

'old american bum going around island' is the wordplay.
'old' becomes 'o' (common abbreviation eg in OE for Old English).
'american bum going around island' becomes 'asis' (I am not sure about this - if you are sure you should give a lot more credence to this answer).
'o'+'asis'='OASIS'

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(Other definitions for oasis that I've seen before include "Peaceful area away from trouble" , "Fertile place like waterhole in desert" , "Green area in desert" , "Pop group" , "Fertile tract in a desert" .)

I've seen this clue in The Independent.

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