CO : $ 420
BU : $ 260
SB (Hero): $ 1300
BB: $ 760

Pre Flop: (pot: $6.00) Hero has A Q 8 7 6
UTG BU Hero calls $4, BB raises to $10, UTG BU Hero calls

Flop: ($80, 4 players) K J T
Hero bets $66, BB raises to $278, CO raises to $400, BU folds, Hero ?

Is there ever a scenario that I should fold my Nut straight even with a flush draw albeit a small one?

With action i would assume one of them at least have a Nut straight with a flush draw which will naturally dominate my small flush draw.

I understand my preflop is loose, probably wont have this problem if i didnt made the call but i was closing the action.

How is there 80$ on flop? Bb raises to 20$ i guess?

Sorry guys, typo it is raises to $20

Preflop is fine both times, first time you're getting 7-1, second time you're closing the action and getting 4-1. I'd be calling with quite a few weaker hands.

I'm more likely to check this flop than lead, would be leading if I had NFD to go with it I think, but it's not a big deal particularly.

It's probably a fold; it's an annoying spot because we've all had those spots where we've made a tight fold and somehow they've both had blockers and a set or something silly and we hold or hit and would have won the lot, but realistically, unless we've seen both guys spew somewhat, our equity ain't great and we need to avoid both a board pair and the flush to come in to get back 50% or even 33% of the pot.