AFP - Oil prices were mixed in cautious Asian trade on Wednesday as dealers await the conclusion of the United States Federal Reserve's policy meeting later in the day, analysts said.

New York's main contract, West Texas Intermediate (WTI) for delivery in September, was up three cents at US$103.11 (S$130.51) a barrel in afternoon trade, and Brent North Sea crude for September fell 22 US cents to US$106.69.

Investors are waiting for a statement from the Federal Open Market Committee (FMOC) at the end of its two-day meeting Wednesday, hoping for some clues about when it will begin to wind down its US$85 billion-dollar-a-month bond-buying scheme.

"The Fed continues to hold investors' attention," Kelly Teoh, market strategist at IG Markets Singapore, said in a note.

"The key event will be (the) conclusion of the FOMC meeting, with most expecting a September tapering," she said.

Other analysts said the Fed is unlikely to announce a major shift from its earlier statements that the timing depends on how strong the economy is.

"It is likely to be more of the same with the Fed reiterating their stance that they are looking to taper when certain conditions are met," said Jason Hughes, head of sales trading at CMC Markets in Singapore.

Over the longer term, however, Ms Teoh said oil prices are expected to trend lower after WTI slipped below its support level of $104 as slower global growth dents demand.

"The underlying support for energy prices has been from geopolitical tensions in the Middle East, renewed optimism on global demand and low inventories," she said. "These factors look short lived and waning," Ms Teoh said.