09:03 AM EDT, 09/17/2024 (MT Newswires) -- Oil prices were mixed early on Tuesday, as supply remains tight even as demand from China continues to weaken.

West Texas Intermediate crude oil for October delivery was last seen up US$0.12 to US$70.21 per barrel, while November Brent crude, the global benchmark, was down US$0.02 to US$72.73.

Prices fell to the lowest in more than three years last week as the economy of China, the No.1 importer slows and institutional interest plunged. The country reported additional weak economic data over the weekend, raising hopes the ruling Communist Party will take more steps to stimulate the economy.

"Speculation that China needs to go big on stimulus to support the economy have helped trigger buying from hedge funds, who last week held the most bearish view on oil in recorded history," Saxo Bank noted.

Supply remains tight, as some Gulf of Mexico production is slow to return following Hurricane Francine passed through the region last week. The U.S. offshore regulator on Monday said 213,204-barrels per day of production remains offline, adding to around 0.7-million barrels per day of lost Libyan supply due to a power struggle between the country's two competing governments.

Expectations an interest-rate cut from the Federal Reserve coming Wednesday will offer a stimulus to a slowing U.S. economy is also supporting oil. The CME Fedwatch tool sees a 67% probability the central bank will begin a cycle of cutting rates with a 50 basis point drop to its benchmark rate.

"For the coming day or two the Fed move will be the dominant driving force ... Oil fundamentals will indisputably take over the role of price-setting, for the immediate future, however, the cost of money in the world's biggest economy will remain in focus," PVM Oil Associates noted.