WTI extends the rally above $70.00 amid Hurricane Francine's impact

• WTI holds positive ground near $70.35 in Tuesday's Asian session. 
• The impact of Hurricane Francine on oil output and firmer Fed rate cut bets support the WTI price. 
• China demand worries might cap the WTI's upside in the near term. 

West Texas Intermediate (WTI), the US crude Oil benchmark, is trading around $70.35 on Tuesday. WTI price gains momentum as Hurricane Francine disrupts production in the US Gulf of Mexico. 

The US Bureau of Safety and Environmental Enforcement (BSEE) reported on Monday that Hurricane Francine disrupted about 12% of the crude oil production and 16% of natural gas output in the Gulf of Mexico. This, in turn, boosts the WTI price to two-week highs. 

Furthermore, the Federal Open Market Committee (FOMC) will announce its interest rate decision on Wednesday. According to CME FedWatch, Fed fund futures show investors are increasingly betting the US Fed will cut by 50 basis points (bps) instead of 25 bps. Lower interest rates will reduce the cost of borrowing, which generally lifts the demand for oil.

On the other hand, persistent Chinese demand concerns might exert some selling pressure on black gold as China is the world's biggest oil importer. Data released on the weekend showed that Chinese Industrial Production growth slowed to a five-month low in August, while Retail Sales and new home prices deteriorated further. 

IG market strategist Yeap Jun Rong noted that the recent weaker-than-expected Chinese economic data dampened market sentiment, with the low-for-longer growth outlook in the world's second-largest economy reinforcing doubts over oil demand.