what platform?

how do you have set height/width appearance settings and resize at runtime?

do you have applied any custom styling/CSS on it or parent containers?

1.  Windows with IE V11

2.  I have tried both resize and not resize.   No difference.

3.  No special CSS

with environment I meant SP2010/2013/O365...

and you haven't mentioned reg. width/height appearance settings

if you are on-prem, remnoving anything from width/height appearance settings and leaving it blank should help, it should set both to 'auto' at runtime.

if that doesn't help, you can create a custom CSS class with settings {width: auto; height:auto} and assign the class to image control to enforce it.