NEW YORK, Sept 23 (Reuters) - U.S. crude futures fell sharply on Wednesday, as oil markets awaited government inventory data and comments from the U.S. Federal Reserve and digested industry oil inventory data that showed crude supplies rose last week. The dollar hovered near a one-year low against a basket of currencies, awaiting the Federal Reserve policy decision, which was expected to keep interest rates at record lows. [USD/] The American Petroleum Institute in its weekly report released late Tuesday said U.S. crude oil stockpiles rose 276,000 barrels last week, as imports rose 219,000 barrels per day and refinery runs dipped 92,000 bpd. [ID:nN22365951] The API report showed distillate inventories fell 1.9 million barrels last week and gasoline stockpiles rose 3.8 million barrels. An expanded Reuters poll of analysts on Tuesday yielded a forecast for U.S. crude oil supplies to be down 1.5 million barrels in the week to Sept. 18. Distillate supplies were expected to be up 1.4 million barrels and gasoline stocks up 400,000 barrels. [EIA/S] The U.S. Energy Information Administration's inventory report is due at 10:30 a.m. EDT (1430 GMT) on Wednesday. "We will be paying particular attention to the response of the dollar to the Fed communique since we continue to view the currency factor as a much larger driver of oil price than the stock market," Jim Ritterbusch, president at Ritterbusch & Associates in Galena, Illinois, said in a note. PRICES * On the New York Mercantile Exchange at 10:14 a.m. EDT (1414 GMT), November crude CLX9 was down $1.23, or 1.71 percent, at $70.53 a barrel, trading from $70.32 to $71.81. * NYMEX October crude CLV9 expired on Tuesday, up $1.84 at $71.55 a barrel, having traded from $69.61 to $71.85. * In London, November Brent crude LCOX9 was down $1.23, or 1.74 percent, to $69.30 a barrel, trading from $69.14 to $70.48. * NYMEX October RBOB RBV9 fell 4.40 cents, or 2.47 percent, to $1.7376 a gallon, trading from $1.7360 to $1.7750. * NYMEX October heating oil HOV9 fell 1.63 cents, or 0.9 percent, to $1.7958 a gallon, trading from $1.7936 to $1.8219. * The November/November RBOB crack spread <0#RB-CL=R> was at $3.16, after ending at $3.67 on Tuesday. The November/November heating oil crack spread <0#CL-HO=R> was at $6.22, after ending at $5.67 on Tuesday. * The spread between the current front month and the five-year forward crude contract CLc61 was at $13.82, based on the November 2014 contract Tuesday settlement at $84.35. The spread ended Tuesday at $12.63, based on October contracts. TECHNICALS NYMEX crude 10-day/20-day moving average: $71.08/$70.60 Technical support/resistance: NYMEX crude: $71.09/$72.70 NYMEX heating oil: $1.80/$1.85 NYMEX RBOB: $1.7260/$1.85 For a full report on technicals, click on [ID:nLN526576] MARKET NEWS * World stocks hit their highest in nearly 12 months on Wednesday as investors remained cautious ahead of the Federal Reserve's policy decision. [MKTS/GLOB] * The U.S. Transportation Department said U.S. driving was up 2.3 percent in July from a year ago. The DOT revised its June estimate down 0.1 point to a 1.9 percent increase from year ago. [ID:nN23388670] * State-run Chinese companies have started supplying Iran with gasoline, the Financial Times reported. Iran is the world's fifth-largest crude exporter but imports up to 40 percent of its gasoline.

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