07.01.202009:53:00UTC+00Oil Prices Slip As US-Iran Tensions Ease

Oil prices fell slightly on Tuesday after surging for the previous two sessions amid heightened tensions in the Middle East.

Benchmark Brent crude declined 0.55 percent to $68.53 a barrel, while U.S. West Texas Intermediate (WTI) crude futures were down half a percent at $62.93.

Prices surged over the past two sessions, with Brent reaching its highest since September and WTI crude rising to the most since April, on fears of escalating conflict and supply disruption in the Middle East in the wake of the United States killing a top Iranian military commander.

However, some analysts have tempered their expectations for a widespread conflict. Consultancy Eurasia Group said Iran will likely focus more narrowly on U.S. military targets instead of energy targets.

There was some confusion earlier in the day after a letter surfaced showing that U.S.-led coalition troops would leave Iraq. The Pentagon later clarified that it was a mistake and "there has been no decision whatsoever to leave."

The Iranian response could come in "many different guises, many different places at any time," said Gerald Feierstein, former U.S. ambassador to Yemen.