Oil price hits $128 high

OIL hit a four-year high yesterday after an Iranian state-run news channel reported an explosion on a pipeline in Saudi Arabia.

Brent crude prices hit $128 a barrel in late post-settlement trade, a level not reached since July 2008.

A Saudi official later denied the Press TV broadcast, saying no oil facilities had been sabotaged.

Iran, the world’s fifth largest oil producer, has been struggling to sell its crude in the face of a EU embargo that kicks in on 1 July. Sanctions threaten to tighten crude supplies and have already pushed up prices.

Meanwhile, UK petrol prices are expected to hit an all-time high today. The AA said the average cost of a litre of petrol is 137.34 pence and that the average cost of filling up a car will soon pass £100.

Chancellor George Osborne is under pressure to delay a planned three pence increase in fuel duty.