Uncertainty about the US election eased after television networks projected a victory for President Barack Obama against Republican challenger Mitt Romney in a tight race, although worries about Iran's nuclear dispute and the fiscal cliff returned to focus.
Negotiations to avert a looming "fiscal cliff", nearly $600 billion worth of spending cuts and tax hikes that risk pushing the economy into deep recession, may turn messy if neither party wins a clear majority in the two houses, analysts say.
"Now the focus will be on the fiscal cliff discussions and on the Iranian dispute, all that is still ahead of us," said Tony Nunan, an oil risk manager at Mitsubishi Corp in Tokyo.
"The market appears evenly balanced with economic worries on one hand and the geopolitical worries and winter drawdown supporting. We see high volatility, but sideways trading for the rest of the year."
Front-month Brent futures were trading down 42 cents at $110.65 per barrel by 0452 GMT, marking the end of uncertainty by bouncing off the day's low of $110.40.
US crude was down 17 cents at $88.55 per barrel, off the day's low of $87.87.
GREECE, MIDDLE EAST
Greece remains another key focus area, where a key parliamentary vote on a new set of wage and pension cuts is set for Wednesday.
Greek protesters took to the streets against the new austerity measures, even though the parliament is expected to approve them by a narrow margin.
The euro zone faces the risk of "aggravation of the situation in Greece, with potential contagion effects to the rest of the area," BBVA analysts said in a report.
But supply worries continued to support oil prices after Middle East violence escalated again.
Bombs exploded in three districts of the Syrian capital Damascus on Tuesday, killing and wounding dozens, while gunmen shot dead the brother of the parliament speaker in the latest rebel attack on a figure associated with the ruling elite.
Directly impacting oil supply out of Syria, an explosion also hit the main oil pipeline feeding a refinery on the western edge of the Syrian city of Homs on Tuesday, during fighting between rebels and army forces in the area.
Moreover, supply of the North Sea crude oil that underpins the benchmark Brent contract is set to slip in December, despite the restart of Britain's largest oilfield, loading programmes showed.
US crude oil inventories fell slightly last week and product stocks rose, data from the American Petroleum Institute showed on Tuesday, confounding analysts' expectations in the wake of Hurricane Sandy, which has caused widespread disruptions to East Coast refineries and terminals.
Inventory data from the Energy Information Administration is scheduled for release later on Wednesday.
Crude inventories are forecast to have risen 1.8 million barrels last week while product stocks were seen falling, an expanded Reuters poll of analysts showed on Tuesday.
Also supporting US crude, data showed that Superstorm Sandy had a small impact on regional gasoline demand.