Oil steady as markets watch Ukraine talks and Fed decision

Oil prices held steady Wednesday after falling about 1% in the previous session, as investors monitored Russia-Ukraine peace talks and awaited a U.S. interest rate decision.

Brent crude futures rose 19 cents to $62.13 a barrel, while U.S. West Texas Intermediate crude also gained 19 cents to $58.44 a barrel.

"Oil markets are struggling for direction, with a minor lift from falling U.S. inventories," said Suvro Sarkar, lead energy analyst at DBS Bank. Traders are awaiting cues from Ukraine peace talks, while the Fed's rate decision could support prices.

API data showed U.S. crude inventories fell 4.78 million barrels last week, while gasoline and distillate stocks rose.

Markets expect the Fed to cut interest rates by a quarter point to support the cooling labor market, which could boost oil demand. However, supply concerns limited gains. ING analysts noted Russian oil supply remains a risk, with barrels struggling to find buyers.

Ukrainian President Volodymyr Zelenskiy said his country and European partners will soon submit "refined documents" to the U.S. on a peace plan with Russia, which could lift sanctions and free up oil supply.

The Energy Information Administration expects U.S. oil production to reach 13.61 million barrels per day in 2025, up from prior estimates, while 2026 output forecasts were slightly lowered to 13.53 million bpd.