Oil prices were lower today but traded up from session lows reached earlier in the day. “Today it’s more like a ping pong game of fear-on, fear-off rather than trading on fundamentals,” said Phil Flynn, an analyst at Price Futures Group. Brent and WTI had surged more than $3.50 on Monday as the military clashes raised fears that the conflict could spread beyond Gaza. While Israel produces very little crude oil, markets worried that if the conflict escalates it could hurt Middle East supply and worsen an expected deficit for the rest of the year. In a more positive sign for supply, Venezuela and the U.S. have progressed in talks that could provide sanctions relief to Caracas by allowing at least one additional foreign oil firm to take Venezuelan crude oil under some conditions. WTI traded down $.41 or to close at $85.97. Brent traded down $.50 or -.57% to close at $87.65.