When you place a barrel, it has 3 health. It only explodes when either it ticks down to one health or you hit it 3 times. Ideally, you'll want to drop a barrel and auto it once to reset your passive and bring it down to 1 health. You'll also notice that the barrels have a radius (the transparent circle around the barrel). Your barrels' radius must intersect in order for them to chain together when they explode.