Prof G Markets The Oil Blockade Isn’t Spooking Markets — Yet
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Apr 14, 2026 
Michael Gapen, Morgan Stanley’s chief U.S. economist, tracks why markets are brushing off Iran oil turmoil and where inflation could go next. Theresa Payton, Fortalice Solutions CEO and former White House CIO, digs into Anthropic’s Mythos model, cybercrime at machine speed, and rising fears in banking. It also explores how weaker law enforcement may be reshaping markets.
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Why Markets Are Not Panicking Over The Blockade
- Michael Gapen says markets treat the Hormuz blockade as de-escalation because oil near $100 raises inflation without yet crushing global demand.
- Stocks rebounded even as oil rose, signaling investors see an inflation shock, not a recessionary oil spike yet.
Oil Shock May Hit Headline Inflation More Than Core
- Michael Gapen expects higher oil to lift headline inflation toward 3.7% while leaving core inflation relatively intact.
- He argues history shows oil shocks hit gas prices fast but usually create limited second-round effects in broader prices.
The Real Risk Is When Expensive Oil Becomes Missing Oil
- Michael Gapen says oil can morph from a price problem into a quantity problem if Hormuz disruption creates actual shortages.
- He warns Asia would likely feel shortages first because about 85% of oil leaving the strait goes there.