Crude oil futures slightly declined and hovered above $97 a barrel during the Asian trading hours Wednesday as traders opted for caution ahead of the U.S. Federal Reserve's policy decision and fourth quarter GDP figures from the government.

Light sweet crude for March delivery declined 0.05 percent or 5 cents to $97.52 a barrel in electronic trading on the New York Mercantile Exchange during Asian trading hours. Brent crude oil futures for March delivery gained 0.07 percent or 8 cents at $114.44 a barrel on the ICE futures exchange in London.

Market participants are likely to focus on the Federal Open Market Committee statement (FOMC) meeting and interest rate decision, which is due to be released at 2:15 p.m. EDT. The interest rate is expected to remain unchanged at 0.25 percent.

“We expect no change to current policy at the January FOMC meeting. Fed Chairman Bernanke in his interview last week said he still was not satisfied with the economy’s progress, and indicated that he plans to stick with the unconventional programs the Central Bank is using to lift output as he feels the measures are effective,” said a note from Credit Agricole.

The Commerce Department will report advanced GDP estimate for the fourth quarter of 2012 before the market opens and is expected to show that economic activity in the world’s largest oil consuming nation weakened during the October-December period. Economists have forecast GDP to grow by 1.1 percent in the fourth quarter compared to 3.1 percent growth reported in the third quarter.

Oil futures surged Tuesday as sentiment was buoyed after Standard & Poor's Case-Shiller home-price index showed a 5.5 percent increase from a year ago, the biggest increase since August 2006. Recent economic reports from the U.S. suggest that the recovery in the world’s largest economy was picking up and raised expectation of a hike in fuel demand. Light sweet crude for the March delivery surged 1.2 percent or $1.13 and settled at $97.57 a barrel on the New York Mercantile Exchange, while Brent crude for the March delivery rose 0.8 percent or 88 cents to $114.22 a barrel.

Meanwhile, an inventory report late Tuesday showed a bigger-than-expected rise in the U.S. crude stockpiles last week. The American Petroleum Institute said crude inventories had increased by 4.16 million barrels in the week ending Jan.25, higher than the analysts’ estimate of a 2.6 million barrel rise.

After the markets open Wednesday, the U.S. Energy Information Administration (EIA) is due to report weekly inventory data that are expected to show that stockpiles increased by 2.583 million barrels last week.