It appears oil markets just heard that one - since the early Saturday attacks on Saudi Aramco facilities talk of war has been on the table, especially given President Trump's initial "locked and loaded" threat - however it now seems certain there will be no war, given the president has announced new sanctions.
"I have just instructed the Secretary of the Treasury to substantially increase Sanctions on the country of Iran!" Trump tweeted Wednesday morning.
The president's announcement of new sanctions are the clearest indicator yet he's holding onto alternatives to war, which immediately sent oil prices retreating further, following Saudi energy minister Abdulaziz bin Salman's Tuesday announcement saying production capabilities were fully restored and that the kingdom's oil output is expected back at pre-attack levels by the end of the month, whereupon oil had tumbled as much as 7% based on that prior assurance.
I have just instructed the Secretary of the Treasury to substantially increase Sanctions on the country of Iran!— Donald J. Trump (@realDonaldTrump) September 18, 2019
This comes even after Tuesday night into early Wednesday both Tehran and Washington were still trading threats, with Iran warning it will "respond" against any steps against it.