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"Obligate," meaning 1. to bind or compel, legally or morally and 2. to commit (money, funds, etc.) to meet an obligation, has connotations of legal and ethical constraints. "Oblige," meaning 1. to constrain by physical, moral, or legal force or by circumstance and 2. to put in one's debt or do a favor or service for, has connotations of constraints more closely associated to protocol, etiquette, and gratitude. It is usually considered more appropriate to use "oblige" to express appreciation, e.g. "They obliged us by not bringing their children" and "John was much obliged for your assistance."
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