Oil prices rose on Friday September 77, 2012 in volatile trading after a disappointing U.S. August jobs report weakened the dollar and bolstered expectations for stimulus from the U.S. Federal Reserve, even while denting the outlook for petroleum demand.

Brent and U.S. crude futures were flirting with weekly losses after posting five straight weekly gains and surging more than 9 percent in August.

U.S. nonfarm payrolls increased by only 96,000 last month, the Labor Department said on Friday, below the forecasted rise of 125,000. While the unemployment rate dropped to 8.1 percent from 8.3 percent in July, it was largely due to Americans giving up the search for employment.

Supportive to crude futures were expectations that the jobs report increases the likelihood that the U.S. Federal Reserve's two-day policy meeting next week will result in a third round of monetary stimulus.

Additional stimulus is expected to weaken the dollar, which is usually supportive to dollar-denominated commodities like oil. .

Brent October crude rose 60 cents to $114.09 a barrel by 1:11 p.m. having swung between $112.34 and $114.65. Brent needs a settlement above $114.57 to avoid a weekly loss.

U.S. October crude was up 81 cents at $96.34 a barrel, off its $94.08 low. The $96.74 session peak was above the 200-day moving average of $96.62. U.S. crude needs a close above $96.47 to post a weekly gain.