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Oil climbed over $110 a barrel for the first time since May after an Iranian state-run news channel reported an explosion on a pipeline in Saudi Arabia.

Futures reached $110.55 at 3:17 p.m. in New York after Iran’s Press TV reported on its English-language website that “an explosion has hit oil pipelines in the flashpoint Saudi Arabian city of Awwamiya in the kingdom’s oil-rich Eastern province.” Saudi officials said there was no explosion, according to the Wall Street Journal. Gold jumped and U.S. equities dropped on the unattributed report.

“Oil is shooting higher due to the Saudi report, absolutely, no question about it,” said Phil Streible, a Chicago-based commodities broker at RJO Futures. “People are buying oil based on the news. Gold is also rising.”

Crude oil for April delivery rose $1.77 to settle at $108.84 a barrel on the Nymex before extending gains after the floor closed. The price was $108.81 at 4:31 p.m. Futures settled at a nine-month high of $109.77 on Feb. 24.

Brent oil for April settlement climbed $3.54, or 2.9 percent, to a 10-month high of $126.20 a barrel on the London- based ICE Futures Europe exchange. Brent rose as high as $128.40 after the settlement and dropped back to $126.17 at 4:31 p.m.

BW/ Bloomberg

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