A high-scoring first round ended with the scores level at five points apiece as both fighters found their range early on.
The fighters could still not be separated after two rounds, which set up a nail-biting finish.
Oubaali began strongly in the final round and was landing more than the Irishman, who was struggling to cope with the Frenchman's intensity.
However, it was Conlon who finished the stronger, landing with a good burst of punches to put some points on the board.
It was a tight decision, but the judges sided with Conlon, who won through by a 22-18 scoreline.