Oil prices fell on Thursday after 15 British sailors arrived on their home shores, ending a conflict that helped drive oil prices up more than 5 U.S. dollars a barrel since they were captured by Iran two weeks ago.

Light, sweet crude for May delivery dipped 10 cents to end at 64.28 dollars on the New York Mercantile Exchange, after earlier reaching 64.94 dollars. Trading volume was light ahead of the long weekend. The Nymex is closed on Friday.

While the crude market softened, gasoline futures gained 2.3 cents to settle at 2.1288 dollars, building on a more than 4 percent gain a day earlier. Prices rose on the back of a report by the Energy Information Administration on Wednesday showing a larger-than-expected increase in gasoline supplies last week.

Retail gasoline prices have risen sharply since the start of the year. The price of unleaded gasoline averaged 2.706 dollars a gallon (71 cents a liter) in the U.S. on Thursday, up 38 cents a gallon since January.

Many refineries have suffered unplanned outages in recent weeks, which has damped demand for crude and reduced gasoline production. In the latest snag, Lyondell Chemical Co said on Thursday it would shut down a gasoline-producing unit at its Houston refinery for about 10 days for maintenance.

The EIA reported that U.S. refineries operated at about 87 percent capacity last week.

"Right now, the oil market has been held back by the lack of refinery runs, but at the same time you're creating a situation in which gasoline inventories are very tight," said Phil Flynn, analyst at Alaron Trading Corp in Chicago.

Refinery problems in the U.S. have prompted traders in the physical market to look overseas -- which, combined with increased demand in Europe, has driven the price of oil traded in London up over 68 dollars a barrel, higher than in New York.

On London's ICE futures exchange, Brent crude for May delivery shed 16 cents to settle at 68.24 dollars.

Valero Energy Corp's McKee refinery in West Texas is a major delivery point for the light, sweet crude that trades on Nymex. An explosion in February took that refinery off-line, making deliveries more complicated.

The "contract that is going to reflect any global uneasiness is going to be Brent these days," said Tom Kloza, an analyst with Oil Price Information Service, Wall, New Jersey.

Yesterday, the EIA reported an increase in natural gas inventories for the week ended March 30. Stocks rose 58 billion cubic feet to 1.569 trillion cubic feet. U.S. inventories of natural gas are about 27 percent above the five-year average for this time of year but slightly below the year-ago level.

Nymex natural gas rose 9.2 cents to finish at 7.607 dollars per 1,000 cubic feet. Heating oil futures fell less than a penny to settle at 1.8609 dollars a gallon.