Oil prices at highest level since 2008

Oil prices spiked to their highest levels since 2008 on fears that tensions with Iran have the potential to disrupt supplies through the Strait of Hormuz, CNN reported.

The price of a barrel of brent crude hit $128.40 a barrel and eclipsed $110 on the New York Mercantile Exchange after a disputed report Thursday on Iran's Press TV and other Middle East outlets of a pipeline explosion in Saudi Arabia.

Prices for brent crude dropped to $125.45 and $108.50 on the NYMEX early Friday.

The price of North Sea brent crude has risen more than 15% this year, while NYMEX crude has risen more than 8.5% on growing tensions surrounding Iran and fears that may lead to the closure of the Strait of Hormuz, a critical pathway for petroleum exports.

While worries in the Middle East have caused a spike, oil prices face longer-term pressure due to increased demand from China and other emerging economies.