WTI Crude Oil futures saw a significant pullback on Tuesday, dropping over 7% as diplomatic developments and demand concerns weighed on the market. May contracts opened lower and continued to decline, hitting their lowest levels since late March. The primary catalyst was reports of potential dialogue between the U.S. and Iran, which effectively removed much of the geopolitical risk premium that had supported prices following Monday's spike. Adding to the bearish sentiment, the International Energy Agency (IEA) issued a warning that regional tensions could stifle global demand growth, potentially leading to the first annual contraction since the pandemic. Traders are now monitoring whether current price levels will further dampen demand as peace negotiations remain a central focus for the energy complex.