Benchmark Brent and US WTI crude oil contracts were on track for weekly gains of more than 4 percent, but fluctuated between intraday gains to losses amid conflicting signals on the supply/demand picture.
Brent crude futures, the international benchmark for oil, were up 54 cents or 1.12 percent at $48.96 per barrel at 12:32 p.m. (1632 GMT)
US West Texas Intermediate (WTI) crude futures were up 55 cents or about 1.2 percent at $46.63 per barrel.
"I think the big driver is inventory numbers," said Stewart Glickman, head of energy research at CFRA Research in New York, "We've finally broken below 500 million barrels, I feel like it's a psychological barrier."
US crude inventories fell 7.6 million barrels last week, its biggest weekly plunge in 10 months, the US Energy Information Administration (EIA) said on Wednesday.
Still, oil stocks remained comfortably above the five-year average, and prices are more than 16 percent below their 2017 highs.
Prices spiked early in the day following a force majeure declaration on exports of Nigeria's Bonny Light crude. They sank into negative territory after data showed US retail sales fell unexpectedly in June, casting doubt on demand in the world's largest oil consumer.
Output cuts from producing countries coordinated by the Organization of the Petroleum Exporting Countries have been stymied by rising output from Libya and Nigeria, which are exempt. June compliance among other members also fell to just 78 percent, according to the International Energy Agency (IEA).
Kuwait's OPEC governor told Reuters in an interview that it would be premature to cap Nigerian and Libyan oil production.
Brent and WTI prices were roughly 5 percent above the week's lows, aided by reports of accelerating demand growth from the IEA, crude oil import growth in China and falling crude stocks in the United States.
China's crude oil imports over the first six months of 2017 were 13.8 percent above the same period in 2016, customs data showed. Asian traders are selling oil products out of tanks amid soaring demand, while the EIA reported the largest drop in US crude oil inventories in the week to last week in 10 months.
Analysts at Commerzbank said a reduction in the developed world's oil stocks was likely to continue "so long OPEC does not significantly increase its output any further".