Shares of Tesla declined Thursday as broader US equity markets came under pressure amid rising oil prices and escalating tensions involving Iran.

Tesla stock fell roughly 3% during the session.

The weakness came alongside a broader market downturn.

The Dow Jones Industrial Average dropped 611 points, or 1.3%, while the S&P 500 lost 1.2%.

The Nasdaq Composite, which includes many technology stocks such as Tesla, fell 1.7%.

Oil prices jump as Strait of Hormuz tensions escalate

Oil prices surged as geopolitical tensions intensified in the Middle East.

Comments from Mojtaba Khamenei, Iran’s newly appointed supreme leader, added to the pressure.

Khamenei said the Strait of Hormuz should remain closed as a “tool to pressure the enemy.”

Following the remarks, West Texas Intermediate crude climbed about 9% to roughly $95 per barrel, while Brent crude rose about 8% to near $100 per barrel.

Higher oil prices often weigh on equity markets because they can increase inflationary pressures and dampen expectations for economic growth.

Tesla expands energy business in Britain

Separately, Tesla secured approval to expand its energy operations in the United Kingdom.

The country’s energy regulator, Ofgem, granted Tesla an electricity supply licence, allowing the company to provide power directly to households and businesses in England, Scotland and Wales.

The approval enables Tesla to supply electricity to residential and commercial customers, replicating a model it already operates in Texas through its Tesla Electric offering.

Tesla Electric allows customers to power homes, electric vehicles and local energy networks using electricity sourced through Tesla’s energy ecosystem.

However, the licence does not permit Tesla to offer bundled gas and electricity services, meaning customers would need a separate provider for gas.

Tesla has not disclosed how many Powerwall units have been installed in Britain, although the company has sold more than 250,000 electric vehicles in the country.

Sales struggle in Europe but China rebounds

Tesla’s electric vehicle sales in the United Kingdom and across much of mainland Europe have declined over the past year.

The slowdown has been attributed to intensifying competition in the electric vehicle market and controversy surrounding the political activities of Tesla CEO Elon Musk.

However, the company has recently reported improving momentum in China.

Sales of Tesla vehicles produced at its Shanghai factory rose for a fourth consecutive month in February.

Combined deliveries of Tesla Model 3 and Tesla Model Y reached 58,600 units during the month, up 91% compared with the same period a year earlier.

The figure followed a 9.3% increase recorded in January.

On a month-over-month basis, February sales declined 15.2% from January levels.

Exports jump as competition intensifies

Exports from Tesla’s Shanghai factory rose sharply.

According to data from the China Association of Automobile Manufacturers, exports climbed roughly fivefold year over year to about 20,000 vehicles in February.

Sales in the first months of the year often fluctuate because of shifting timing for the Lunar New Year holiday, which affects production schedules and consumer demand.

Tesla’s deliveries in early 2025 were also impacted by a temporary production suspension tied to upgrades for the refreshed Model Y.

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