Literal translation
from one olive at the backside, he makes you a liter of oil
Meaning
he's terrified, a real coward
Explanation
The image is deliberately exaggerated and burlesque: it claims that a single olive lodged in the cuou, the backside, would be enough, through sheer nervous contraction caused by fear, to squeeze out a full liter of olive oil, an obviously absurd quantity for one tiny fruit. This comic hyperbole describes someone so extremely cowardly that they react to the slightest threat, even one as minor as an olive, with an outsized physical clenching, as though their whole body seized up violently from panic. The expression belongs to a thoroughly familiar, burlesque register, typical of Provençal humor that likes to push an image to the point of absurdity for laughs while still driving home the character trait being mocked. It is said of a notorious coward, someone whose fear becomes a running joke among friends, precisely because their reaction always wildly outstrips what the actual situation would call for.