Oil rig

Some of the world's biggest oil producers have agreed to freeze production at January levels in an attempt to boost prices.

Three members of Opec (Organization of Petroleum Exporting Countries) - Saudi Arabai, Qatar and Venezuela - and Russia all agreed to freeze production, as long as other oil producing nations do the same.

Oil ministers from the respective countries met in Doha today (Tuesday), initially boosting prices ahead of the talks. But Brent crude oil has fallen 3% to $34.34 per barrel following the news of a deal being agreed, wiping out the gains it made on Monday and Tuesday.

The meeting had been kept secret until now. The talks were the highest-level between oil producing nations for months, and with Saudi Arabia's oil minister Ali al-Naimi and Russia's Alexander Novak present highlighting its importance. It is understood that an accord between Saudi Arabia and Russia was particularly key to the outcome of the meeting.

Ali al-Naimi said: "Freezing now at the January level is adequate for the market.

"We don't want significant gyrations in prices, we want to meet demand. We want a stable oil price.".

Opec (Organization of Petroleum Exporting Countries) had so far resisted calls to reduce production. The problem facing oil prices is huge oversupply, with nowhere near enough demand. Many experts have urged Opec to cut production to reduce the level of oversupply. Some cynics have suggested that Saudi Arabia, which is a dominant force in Opec, has refused to reduce production to maintain political leverage in the Middle East.