UPDATE 7-Oil weaker on inventory build, U.S. Fed remains the focus
* Fed could stem asset purchase program in H2
* U.S. EIA crude stocks post unexpected rise
* U.S. East Coast gasoline stocks lower
* Brent/WTI spread the narrowest since 2011
(Adds details throughout; updates prices. Changes byline/dateline to New York.)
NEW YORK, June 19 (Reuters) - Crude oil prices on both sides of the Atlantic were weaker in choppy trading on Wednesday after a U.S. government report showed an unexpected build up in crude oil stocks.
Oil trading lacked direction and remained volatile as the market waited on the U.S. Federal Reserve to announce its decision on when or if it might ease its economic stimulus program, market participants said.
"The build in crude is putting some selling pressure on prices," said Gene McGillian, an analyst with Tradition Energy in Stamford, Connecticut. "But the market is waiting on the Fed communiqué."
The Fed bond buying program has been largely supportive of commodities because it has lowered the value of the U.S. dollar, making goods priced in dollars cheaper for other currencies.
Brent crude oil futures for August delivery were up 4 cents to $106.06 a barrel at 12:18 p.m. EDT (1618 GMT) after trading as high as $106.59.
U.S. crude oil futures were trading 17 cents lower at $98.27 per barrel after hitting a nine-month high of $99.01.
U.S. crude stocks rose by 313,000 barrels against market expectation for a 500,000 barrel decline, data from the U.S. Energy Information Administration showed.
The data contrasted with figures from the American Petroleum Institute on Tuesday that showed commercial crude oil stocks fell by around 4 million barrels last week.
Gasoline stocks in the densely-populated U.S. East Coast fell by 1.5 million barrels last week, EIA data showed, but were still up by nearly 8 million barrels compared with the same time last year.
U.S. gasoline futures were trading 0.42 percent higher at $2.89 per gallon after settling at $2.87 on Tuesday.
Global investors have been on edge since Fed Chairman Ben Bernanke suggested last month that the U.S. central bank could consider rolling back its monetary stimulus program.
Federal Reserve policymakers are likely to announce at 2 p.m. (1800 GMT) that they will continue buying bonds at a monthly pace of $85 billion, while keeping options open to scale back later this year if the U.S. labor market continues to improve.
"Bernanke will try to hand-hold the market and manage expectations, but the outlook for easing will depend on data, so we'll have volatility for the rest of the summer," said Michael Hewson, a strategist at CMC Markets.
Brent crude oil reached an 11-week high earlier this week, buoyed by fears of oil supply disruption if other Middle Eastern nations are drawn into Syria's civil war, where heavy fighting was reported on Tuesday in Aleppo, its biggest city.
Unless there was more evidence that other Middle Eastern nations could be drawn into the conflict, related oil price rallies would fade, Marc Ground, an analyst at Standard Bank, said in a note.
The spread between global benchmark Brent crude and U.S. benchmark West Texas Intermediate <CL-LCO1=R> narrowed to $6.99 per barrel during early morning trading, the highest since November 2011. It was last trading at $7.58.
(Additional reporting by Simon Falush in London and Florence Tan and Jessica Jaganathan in Singapore.; Editing by Jane Baird, Keiron Henderson and Andre Grenon)