• Crude Oil edges down, partly reversing Monday’s gains. 
• Oil fails to rebound sharply despite markets pricing in a large Fed rate cut and tropical storm Francine wipes out 3.6m barrels of output.
• The US Dollar Index remains under pressure, trading at the lower boundary of September’s bandwidth. 

Crude Oil falls on Tuesday, hovering around $68 and partly reversing Monday’s rally, which stalled close to the $70 handle. The decline comes even as Oil is supported by some bullish drivers coming into play for this week. The first element is the numbers from tropical storm Francine’s passage in the Gulf region as the evacuation of the area will account for nearly 3.6 million barrels less in oil output for last week. 

Another driver that should support prices is the growing expectations that the US Federal Reserve (Fed) will opt for a large 50-basis-points interest-rate cut on Wednesday. This helps Crude Oil prices higher in the assumption that a bigger rate cut would give a brief push to the economic activity, which in turn would benefit Oil demand.