It's taking advantage of the presence of a "cycler" object in the template context which has an __init__ method that can be used to access globals, then builtins, then call the exec() function against a string of code.

Jinja doesn't promise to be secure out of the box (the text on their homepage is misleading: "Jinja doesn’t allow arbitrary Python code in templates" - what it means is that there isn't a documented way to drop code into a template like you might have with PHP) - there's a sandbox mode but it's not guaranteed either: https://jinja.palletsprojects.com/en/stable/sandbox/

Sandboxing in Python code is hard!