Barack Obama has rejected the proposed Keystone XL oil pipeline from Canada, saying the project would not make any "meaningful long-term contribution" to the US economy.

Speaking at the White House, the President said the $8bn (£5.2bn) project would not reduce fuel prices for drivers, nor would it boost US energy security.

Secretary of State John Kerry added that the pipeline, first proposed by TransCanada in 2008, would also have an adverse impact upon the environment.

"The critical factor in my determination was this: moving forward with this project would significantly undermine our ability to continue leading the world in combating climate change," Mr Kerry said.

The Keystone XL project would have linked existing pipeline networks in Canada and the US to bring crude oil from Alberta, and also some from North Dakota, to refineries in Illinois.

The project would have brought an estimated 800,000 barrels of oil per day from Alberta's oil sands.

The proposal led to a wave of environmental activism, with the pipeline seen as a litmus test for environmentalists' ability to block fossil fuel extraction in Canada's oil sands.

Bill McKibben, co-founder of the environmental group 350.org, said: "This is a big win.

"President Obama's decision to reject Keystone XL because of its impact on the climate is nothing short of historic.

"(It) sets an important precedent that should send shockwaves through the fossil fuel industry."

Supporters of the project said it would have created jobs and strengthened North America's energy security.

Canadian Prime Minister Justin Trudeau said he was disappointed with the decision, but added it would not hinder relations between the two countries.

"The Canada-US relationship is much bigger than any one project and I look forward to a fresh start with President Obama to strengthen our remarkable ties in a spirit of friendship and cooperation," he said.

"We are disappointed by the decision but respect the right of the United States to make the decision."

On Monday, TransCanada said it had sent a letter to Mr Kerry asking for the review into the project to be suspended .

The company said a suspension was appropriate while it works with Nebraska authorities to secure approval of its preferred route through the state.