Brent crude tops $104 as Trump rejects Iran peace terms; Morgan Stanley warns $150/bbl if Hormuz closes

Brent crude climbed to $103.99 per barrel on May 11 — up $2.70 (+2.67%) — touching an intraday high of $106.00. Oil futures spiked more than 3% when President Trump stated that Iran's latest offer to end the conflict was "totally unacceptable." U.S. equity futures fell in parallel as investors priced in an extended confrontation.

Morgan Stanley: $150 Brent — 'A Race Against Time'

Morgan Stanley published a note on May 11 warning that a closure of the Strait of Hormuz — through which roughly 20% of global oil supply transits — could drive Brent to $150 per barrel by summer, characterizing the situation as "a race against time." The bank identified three trigger points: expanded Iranian mining operations, direct confrontation with commercial vessels, and retaliatory escalation. At $150/bbl, global consumers would face fuel costs not seen since the 2022 energy shock.

Pimco: Iran Conflict Could Force Fed to Raise Rates

Separately, Pimco — reported via the Financial Times — argued that a sustained Iran war premium in energy prices could prevent further Fed rate cuts and potentially force a rate increase. An oil-driven CPI spike could break the current FOMC "hold" consensus and require markets to reprice the terminal rate upward.

Context

May 10 coverage addressed Iran's initial Hormuz threat and its impact on South Korean shipping names. The May 11 additions are two new dimensions: Morgan Stanley's quantified $150 price target and Pimco's monetary policy implication. Brent remains well below $150, but the intraday move to $106 underscores how quickly supply anxiety translates to price action. The next monitoring points: diplomatic channel developments and U.S. Navy posture in the Gulf. Reference: Morgan Stanley via MarketWatch.