Crude-oil futures fell below $49 a barrel early Wednesday, losing nearly 1% as expectations of a rise in U.S. crude inventories weighed on energy prices. Crude for April delivery fell 43 cents to stand at $48.70 a barrel in electronic trading on Globex. The April contract will expire on Friday. Crude for May delivery, which drew a greater amount of trading volume, dropped 42 cents to $49.61 a barrel. Prices fell after data from the American Petroleum Institute issued late Tuesday gave rise to traders taking profits in crude, said Nimit Khamar, an analyst at Sucden Financial Research. On tap for later Wednesday are data on U.S. petroleum inventories from the Energy Information Administration, which uses different criteria than the API. The EIA will release its weekly update at 10:30 a.m. Eastern. The API reported that crude stockpiles rose by 4.65 million barrels during the week ended March 13. The API also said that gasoline and distillate supplies rose by 383,000 barrels and 327,000 barrels, respectively, on the week. "Generally, the API has not been a very reliable indicator for the more closely watched EIA figures, but the larger-than-expected builds prompted profit-taking as a precaution, especially with technical resistance in the $50/51 [a barrel] region," Khamar said in a research note. Analysts surveyed by energy information provider Platts expect that the EIA's data will show a 2-million-barrel increase in U.S. commercial crude stockpiles. They're also projecting a 400,000-barrel increase in distillate inventories as well as a decline of 2.1 million barrels in gasoline stocks, the Platts survey showed. Refinery utilization is expected to remain unchanged at 82.7% of capacity. "Should the data show a similarly strong buildup of stocks like the API data, WTI [West Texas Intermediate crude] will probably come under more pressure since the price rally of the past days was also driven by speculation that production cuts by OPEC will lead to tighter oil supplies and to a reduction of high stockpiles," said analysts at Commerzbank. On Tuesday, crude prices surged nearly 4% after a government report showed a surge in U.S. housing starts. The rally came two days after the Organization of Petroleum Exporting Countries voted to keep production quotas unchanged but pledged to get member nations fully comply with their earlier cuts. Also Wednesday on Globex, April reformulated gasoline fell 1 cent to $1.41 a gallon and April heating oil was flat at $1.28 a gallon. April natural gas futures fell 1 cent to $3.80 per million British thermal units. U.S. stock futures pointed to a weaker start on Wednesday, with investors nervous ahead of the results of the Federal Reserve meeting. See Indications. The Federal Open Market Committee will conclude its two-day meeting on the economy and monetary policy later Wednesday amid signs the economy is still continuing to contract sharply. Over the past year, the Fed has slashed rates to zero and thrown $1 trillion at selected credit markets to try to break the economy's vicious downward cycle.

Source