The contract finished 10 cents lower on Thursday at US$124.12 after rising as high as US$126.64 and falling as low as US$120.75.
Options let investors bet oil prices will rise or fall in the future. Oil prices can fluctuate widely on days when options expire, analysts said.
Also, the June crude oil contract expires next week, and that may be adding to the volatility.
Fluctuations in the dollar contributed as well. The dollar has generally been stronger than earlier in the year, but it is waffling between 104 and 105 against the yen, while the euro seems to be range-bound between US$1.54 and US$1.55.
Investors have been viewing oil and other commodities as a hedge against inflation and a weaker dollar since the middle of last year, and that link has meant that oil has been tending to rise and fall inversely with the dollar.
Meanwhile, natural gas prices tumbled Thursday after the Energy Department said natural gas inventories rose by 93 billion cubic feet last week, more than analysts had expected. That helped pull oil prices down from its early highs in the previous session, analysts said.
In London, July Brent crude rose 76 cents to US$123.39 a barrel on the ICE Futures exchange in London.
