Oil prices drop as traders gauge Middle East tensions

Oil prices edged lower on Thursday, as traders assessed whether the previous day's jump to the highest prices in more than two months had adequately priced in risks for crude oil supply from mounting tensions in the Middle East.

Brent crude futures were down 34 cents, or 0.5%, at $69.43 a barrel at 11:32 a.m. ET (1532 GMT). U.S. West Texas Intermediate crude fell 18 cents, or 0.3%, to $67.97 a barrel.

On Wednesday, the U.S. decided to move personnel out of the Middle East, and both benchmarks surged more than 4% to their highest since early April.

The surge put the market in overbought territory based on several technical indicators, so it was likely due for a brief correction, StoneX Energy analyst Alex Hodes said.

On Wednesday, U.S. President Donald Trump said he was growing less confident that Tehran would agree to stop enriching uranium, a key demand in U.S. talks with Iran over its nuclear program. Trump has previously threatened to strike Iran if the talks fail.

Tehran, which asserts its nuclear activity is for peaceful purposes, has said it would retaliate against strikes by hitting U.S. bases in the region. Iran will not abandon its right to uranium enrichment, a senior Iranian official said on Thursday.