An oil rig is shown in this file photo.

London - Oil prices fell on Wednesday as investors awaited the outcome of the Federal Reserve's policy meeting and energy stockpiles data in the United States, the world's biggest consumer of crude.

Traders meanwhile locked in profits after recent sharp gains while keeping a close eye on international tensions over Russia's absorption of Crimea.

New York's main contract, West Texas Intermediate (WTI) for delivery in April delivery, dipped nine cents to $99.61 a barrel.

Brent North Sea crude for May dropped 53 cents to $106.26 a barrel around midday in London.

WTI had jumped $1.62 Tuesday on news of a pipeline expansion that will help to draw down bulging crude supplies at the country's Cushing depot in Oklahoma.

Investors are watching for the outcome of the US Federal Reserve's two-day policy meeting that ends later Wednesday.

The US central bank is expected to cut its massive stimulus programme further amid a gentle recovery for the world's biggest economy.

Also Wednesday, the US Department of Energy publishes data on American energy stockpiles, an indicator of demand for products ranging from crude to gasoline and heating fuel.

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 Crimea.

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 post-Cold War low.

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