Tesla slips 1.5% on Middle East tensions, autonomy progress noted

Tesla shares fell 1.5% to $390.91 on Wednesday after a roughly 3% drop on Tuesday, as rising oil prices and renewed tensions in the Middle East weighed on U.S. equities. The Dow fell about 251 points, or 0.5%, while the S&P 500 and Nasdaq traded near flat.

President Donald Trump wrote early Wednesday that Iran had “taken too long to negotiate a deal that would have been great for them, now they will have to pay the price!!!” West Texas Intermediate crude futures rose more than 1% to about $89 a barrel following the remarks.

Piper Sandler analyst Alexander Potter reiterated an Overweight rating on Tesla, writing in a client note that the company has “solved the self driving puzzle” and has largely reached Level 4 autonomy in most driving conditions.

Potter pointed to Tesla’s Full Self-Driving subscription disclosure in the first quarter of 2026, growing subscription adoption, and a production ramp of the Cybercab robotaxi. Piper Sandler reported volume production began in April with hundreds of units built weekly and estimated the production line investment at several hundred million dollars to over $1 billion.

Tesla plans to expand robotaxi services to seven additional cities by the first half of 2026, adding to operations in Austin and the Bay Area and recent rollouts in Houston and Dallas. Piper Sandler reported Austin coverage now includes the entire metropolitan area and interstate highways.

Tesla has sought permits for a roughly 35,000-square-foot facility in Irving, Texas, to support vehicle storage and charging. The site proposal includes 212 parking spaces and 16 Supercharger stalls.

While autonomy and robotics developments were highlighted by Piper Sandler, vehicle sales and manufacturing remain central to Tesla’s near-term results. Market reaction to geopolitical developments and higher oil prices influenced trading during the session.