Crude-oil futures declined more than US$3 yesterday, as strength in the US dollar and news that BP's Forties pipeline will restart operation within days pulled down energy prices.

Forecasts that US crude inventories have increased for a second week weighed on oil prices as well.

Crude oil for June delivery lost US$3.12, or 2.6 percent, to end at US$115.63 a barrel on the New York Mercantile Exchange.

A stronger dollar gave investors another reason to sell crude yesterday. Commodities such as oil are less effective hedges against inflation when the dollar is gaining ground, and a stronger greenback makes oil more expensive to investors overseas.

A monthly Energy Department report said that demand for finished petroleum products dropped 8.5 percent in February from January, and demand for gasoline fell by 6.2 percent, which suggests high prices are cutting American's appetite for fuel, analysts said.

At the same time, a British refinery strike that raised concerns about supplies ended yesterday, and analysts surveyed by Platts expect the Energy Department's weekly inventory report today to show domestic crude supplies rose last week.