The Fed is forecast to unveil a half-percentage-point interest rate hike -- its biggest increase since 2000 -- as global central banks race to tame galloping inflation in the wake of the Ukraine war.

The announcement is due one day before the Bank of England is also predicted to deliver a hike.

India's central bank unexpectedly ramped up its key rate by 40 basis points to 4.4 per cent on Wednesday.

Policymakers are seeking to tackle runaway prices but risk damaging global economic recovery from the pandemic.

Investor sentiment also remains dogged by fallout from Russia's ongoing Ukraine invasion, which has fuelled bumper gains for many raw materials including crude.

That has, in turn, sent inflation accelerating to multi-decade highs in nations including Britain and the United States.

Oil was more than three-percent higher after the latest EU crackdown on Russia, which is a major producer of crude.

"We now propose a ban on Russian oil. This will be a complete import ban on all Russian oil, seaborne and pipeline, crude and refined," European Commission chief Ursula von der Leyen told the European Parliament.

But, she added, "we will make sure that we phase out Russian oil in an orderly fashion", with crude banned gradually over the next six months and refined fuels by the end of the year.

Hungary, however, warned it could not vote for the ban "in this form". The country is highly dependent on Russian crude.

The EU executive also proposed excluding Russian bank Sberbank from the SWIFT network among its measures.

'EU tightens screw'

"As the EU tightens the sanctions screw on Russia by bringing in a phased ban on its crude oil, worries about global supply have reared up again," said Susannah Streeter, senior analyst at Hargreaves Lansdown.

"The price of the benchmark Brent scurried up ... to above $108 a barrel after the toughened up stance emerged."

Oil traders were already on tenterhooks before Thursday's gathering of OPEC and other key producers including Russia, who will discuss whether or not to lift output more than expected.

Key figures at around 1545 GMT

London - FTSE 100: DOWN 0.90 per cent at 7,493.45 points (close)

Frankfurt - DAX: DOWN 0.49 per cent at 13,970.82 points (close)

Paris - CAC 40: DOWN 1.24 per cent at 6,395.68 points (close)

EURO STOXX 50: DOWN 0.96 per cent at 3,724.99

New York - Dow: DOWN 0.2 per cent at 33,059.98

Brent North Sea crude: per cent at $ per barrel

West Texas Intermediate: per cent at $ per barrel

Hong Kong - Hang Seng Index: DOWN 1.1 per cent at 20,869.52 (close)

Tokyo - Nikkei 225: Closed for a holiday

Shanghai - Composite: Closed for a holiday

Euro/dollar: UP at $1.0546 from $1.0521 on Tuesday

Pound/dollar: DOWN at $1.2491 from $1.2499

Euro/pound: UP at 84.46 pence from 84.18 pence

Dollar/yen: DOWN at 129.99 yen from 130.14 yen

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