Oil prices have risen above $100 a barrel due to the disruption of tanker traffic through the Strait of Hormuz since the Middle East war began. Morgan Stanley’s global chief economist, Seth Carpenter, stated that $125 per barrel is the level where the situation fundamentally changes. He warned that if prices continue to exceed this level, markets will constrain demand to match reduced supply. This could lead to slower global growth, increased inflation burden across economies that import most of their oil, and demand destruction that takes months or years to fully reverse. The EIA's latest forecast expects Brent to remain above $95 a barrel for the next two months before easing in the second half of the year as flows normalize. However, this depends on whether the conflict de-escalates.