New York's main contract, West Texas Intermediate (WTI) for April delivery, was down 34 cents to $99.36 in mid-morning trade, and Brent North Sea crude dropped 16 cents to $106.63 for its May contract.

WTI jumped $1.62, or 1.7 percent, in US closing trade Tuesday on news of a key pipeline expansion that will help to draw down bulging crude supplies at the country's Cushing depot in Oklahoma.

Desmond Chua, market strategist at CMC Markets in Singapore said "we are still due for more rising tensions in terms of follow up actions from Russia" in its showdown with the West over Ukraine's strategic Crimea peninsula.

More than 70 percent of Russia's oil and gas exports to Europe pass through Ukraine and there are concerns that Western sanctions on Moscow could lead to a disruption of supplies.

President Vladimir Putin on Tuesday signed a treaty claiming Crimea as Russian territory, as Ukraine warned the showdown had entered a "military stage" after soldiers were killed on both sides.

The treaty signing was conducted at lightning speed in the Kremlin in a defiant expansion of Russia's post-Soviet borders that has plunged relations with the West to a new post-Cold War low.

The move, less than three weeks after pro-Moscow troops first seized control of the strategic peninsula, triggered furious condemnation from Western leaders.

Meanwhile, investors are also keeping an eye on the outcome of the US Federal Reserve's two-day policy meeting that ends later Wednesday.

The US central bank is expected to further cut its massive stimulus program amid a slowly recovering economy in the world's largest crude-oil consuming nation.