Oil futures were trading on either side of unchanged Tuesday morning after gaining three of the past four sessions, with traders looking for direction as they weighed concerns about the outlook for demand a day ahead of a Federal Reserve rate decision.

Oil prices rose by a dollar a barrel on Tuesday as supply disruptions mounted and traders bet that demand will grow if the U.S. Federal Reserve lowers borrowing costs this week, as is widely expected.

The U.S. dollar strengthened against most major currencies on Tuesday following better-than-expected retail sales data that seemed to support a less aggressive stance by the Federal Reserve, which is widely expected to deliver its first interest rate cut in more than four years.

This week’s main event is the Federal Reserve’s September meeting, where the central bank is widely expected to deliver its first rate cut. Despite the Fed chair’s dovish tone in Jackson Hole, markets had placed the probability of a 50 basis point rate cut in September at just 30%.

CommSec’s Tom Piotrowski says there is a “groundswell of optimism” the US Federal Reserve could be cutting interest rates by as much as half a per cent.

Oil prices rose in Asian trade on Monday amid expectations of a U.S. interest rate cut this week, though gains were capped by persistent demand worries and weaker China data. Brent crude futures for November were up 38 cents,

The currency was unable to benefit from weakness in the greenback in the face of dollar demand from importers, including local oil companies, traders said.