* U.S. crude stocks drop 2.9 mln bbls, distillates also fall -EIA
* U.S. Fed verdict on stimulus looms
* Coming Up: Federal Reserve chairman briefing; 1930 GMT
NEW YORK, Dec 18 (Reuters) - Brent oil futures rose in light trading on Wednesday, widening its premium to U.S. crude as investors appeared reluctant to lock in positions ahead of a U.S. Federal Reserve policy decision on a plan to trim its monetary stimulus.
Fed Chairman Ben Bernanke is expected to give details later on when the U.S. central bank may start to reduce its $85 billion-a-month bond-buying program which has supported assets such as commodities, and restrained the dollar.
"Right now the market's pricing in 'No taper,"' said Rich Ilczyszyn, chief market strategist and founder of iitrader.com LLC in Chicago.
"Equities are poised to break out today if the Fed decides not to taper, and crude would benefit too."
Strong demand for Brent from Mediterranean refiners in the absence of Libyan supply also supported the international benchmark.
U.S. crude gained little support from data from the U.S. Energy Information Administration (EIA) showing crude inventories in the world's largest oil consumer dropped 2.9 million barrels to 372.3 million barrels, compared with forecasts of a 2.3 million barrel draw. The higher-than-expected draw was countered by data showing refinery runs fell 1.1 percent from the previous week.
Brent crude rose 93 cents to $109.37 by 12:22 p.m. EST (1722 GMT) GMT, after settling nearly $1 lower on Tuesday.
U.S. oil rose 21 cents to $97.43, after earlier rising 79 cents to a high of $98.01 after strong housing data from the U.S.
The spread between the two benchmarks stood at $11.94 after earlier widening by over $1 to $12.07 at one point, as Brent rallied and U.S. crude pared earlier gains.
U.S. RBOB gasoline futures gained 4.27 cents to $2.6899.
A steady run of firm U.S. economic data in recent weeks has raised speculation the Fed could reduce its bond buying, known as quantitative easing or QE, at its policy meeting ending later in the day.
"The market is mixed as to whether or not the U.S. Fed will announce a tapering program of its massive QE3 stimulus buying that has been adding $85 billion per month to the economy," said Dominick Chirichella of the Energy Management Institute.
"The U.S economy has been improving over the last several months but the main question facing the Fed is (whether) the economic improvement of late is sustainable and will the economy continue to expand enough to continue to lower the still large unemployment problem in the U.S?"