US benchmark West Texas Intermediate for July delivery gained 38 cents to $106.74, while Brent crude for August eased 14 cents to $113.31 in mid-morning trade.

Singapore's United Overseas Bank said trading "will be dominated" by the Fed's formal policy statement to be released later Wednesday after a two-day meeting of its key decision-making body.

The US central bank is largely expected to maintain its current policy of keeping federal funds rate at zero, and steadily cutting back its stimulus programme.

French bank Credit Agricole said investors will focus on the Fed's projections for US economic growth, unemployment, inflation and the expected timing of any interest rate increase.

Investors meanwhile remain jittery over the unabated sectarian violence in Iraq.

Prime Minister Nuri al-Maliki on Tuesday fired several top security commanders in a major shake-up of security forces as fighting approached Baghdad in a jihadist-led insurgency the UN has warned could break up the country.

The Islamic State of Iraq and the Levant along with loyalists of former president Saddam Hussein have so far taken territory in Iraq's north, where a relatively small crude output had already been off the market since March due to violence.

However, BP chief executive Bob Dudley on Tuesday voiced confidence that the worsening crisis will not reach the country's far south, where most of its oil infrastructure is located.

Iraq is the second-biggest oil exporter in the 12-nation Organization of Petroleum Exporting Countries (OPEC) after Saudi Arabia.