The price of oil fell below $106 a barrel Tuesday, Sept 17, anticipating that the U.S. Federal Reserve's two-day policy meeting will end with an announcement to scale back its unprecedented monetary stimulus.

Benchmark oil for October delivery was down 81 cents to $105.78 per barrel at early afternoon Bangkok time in electronic trading on the New York Mercantile Exchange. The contract fell $1.62 to close at $106.59 on Monday.

The U.S. central bank has been on a bond-buying spree that has pumped the economy full of money, pushing down interest rates and making loans more easily available. The aim of all that was to spur lending, growth and investment. Global stocks and commodities surged, the AP says.

But recent data has shown the U.S. is slowly recovering from the severe downturn that followed the collapse of Lehman Brothers in 2008, convincing Fed members that it might be time to wind down the stimulus program. Oil markets have reacted negatively to the prospect.

"Tapering might derail the recovery, and if that happens, there is less growth and then less demand for commodities like oil," said Stan Shamu, market analyst at IG in Melbourne, Australia.

"Regardless of the outcome of the Fed meeting, the market is pricing in the possibility that a more dovish stance will be taken," AFP quoted Kenny Kan, market analyst at CMC Markets in Singapore, as saying.

The contract for November delivery for Brent crude, the benchmark for international crudes used by many U.S. refineries, fell 51 cents to $109.56 a barrel in London.