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February 24, 2011 8:26 pm

Rumor: Gaddafi has Been Shot

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Libyan Leader Muammar Gaddafi.

CNBC – Oil sank from 2-1/2-year highs near $120 a barrel Thursday in a late-day rout, dragged down by an unsubstantiated rumor Muammar Gaddafi had been shot and Saudi Arabia’s assurances it can counter Libyan supply disruptions.

A U.S. official said Washington had no reason to believe the Libyan leader was dead after the rumor swept through oil markets and sent prices tumbling more than $2 a barrel just before settlement.

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