Oil prices dropped below 70 U.S. dollars a barrel Tuesday as traders said Hurricane Dean appeared set to miss major oil and gas production facilities in the Gulf of Mexico run by U.S. companies.

New York's main oil futures contract, light sweet crude for delivery in September, dropped 1.65 dollars to close at 69.47 dollars a barrel.

In London, the price of Brent North Sea crude for October delivery settled 1.16 dollars lower at 68.69 dollars a barrel. The contract had earlier fallen to its lowest level since June 11.

The International Energy Agency said Tuesday that it was slightly concerned about the impact on local oil production when Hurricane Dean hits Mexico -- but believed its passage will not affect global oil markets.