Webpack resolve-url-loader resolving incorrect paths

I'm making use of the resolve-url-loader which is working great for importing third party stylesheets that are in turn linking to their own assets.

However, i'm struggling to understand how in the instance below my reference to owl.jpg from app.scss manages to successfully resolve?

Folder structure:

src/
|
|- index.html
|
|-img/
|  owl.jpg
|
|- scss/
|   app.scss
|   
|-js/
|  app.js

app.scss

These incorrect paths to the asset still seem to resolve?

.owl {
    background: url('owl.jpg');
}

.owl {
    background: url('/owl.jpg');
}

.owl {
    background: url('img/owl.jpg');
}

Surely the path should only resolve with the below path?

.owl {
    background: url('../img/owl.jpg');
}

Am i missing something? Is the resolve-url-loader clever enough to resolve incorrect paths??