Oil market loses more ground

Oil prices slid Wednesday as investors awaited the US Federal Reserve's latest monetary policy meeting and a closely watched report on crude inventories in the world's biggest economy.

Worries over the Chinese economy after a recent rout in the country's stock market and global crude oversupply were also keeping buyers at bay, analysts said.

US benchmark West Texas Intermediate for delivery in September dropped 23 cents to $47.75 a barrel compared with Tuesday's close.

Brent North Sea crude for September delivery shed 26 cents to stand at $53.04 a barrel in London late morning deals.

Later on Wednesday, the US central bank's policy-setting Federal Open Market Committee (FOMC) will issue a statement at the end of a two-day meet, with investors hoping for clearer signs on the timing of a US interest rate hike.

A rate rise will boost the greenback, making dollar-priced oil more expensive to holders of weaker currencies, hurting demand and helping push crude prices lower.

Investors will "pay close attention to the text of the FOMC statement for any confirmation/insights for the timeline of the first rate hike," Singapore's United Overseas Bank said in a research note.

"I feel that (Federal Reserve chief Janet) Yellen will continue to lay the ground for an imminent interest rate increase," said Bernard Aw, market strategist at IG Markets Singapore.

"We may see a modestly upbeat spin on economic prospects in the policy statement, which would underpin expectations of a rate hike this year."

The market is also awaiting data later Wednesday of last week's US crude inventories as American oil drillers ramp up production despite the supply glut that has depressed prices.

A plunge in Chinese shares this week has stoked fears that demand from the world's second biggest economy will be affected.

Chinese stocks ended the morning session 0.21 percent lower Wednesday, erasing earlier gains and extending a plunge of more than 11 percent in the previous three sessions.