Oil ministers from three Opec countries, Saudi Arabia, Qatar and Venezuela, as well as Russia, have agreed to freeze oil output at January levels, as long as others follow suit.
The announcement came after the four ministers met in Doha on Tuesday.
The move is designed to support the oil price, which has dropped sharply in recent months.
Oil prices have fallen about 70% from their recent peak of around $116 a barrel in June 2014.
The steep decline is due to oversupply, sluggish demand and worries about the global economic outlook.
Brent crude, which had been up more than 5% earlier, fell back to be 0.76% higher at $33.61 a barrel, while US crude was up 0.3% at $29.85
Saudi Arabian
oil minister 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."
'Pressure'
The closed-door meeting indicates the mood may be shifting among producers, especially Saudi Arabia, which has been determined to defend market share rather than prices in the face of competition from US shale oil producers.
Opec's plan to drive out higher-cost producers has proved largely ineffective.
City
Index analyst Fawad Razaqzada said the move had disappointed the market
slightly because many had hoped for a cut rather than a production
freeze.
"In the short term, oil prices may come under some
pressure. Nevertheless, it is a step in the right direction and if other
major producers follow suit then at the very least it should help to
prevent oil prices from suffering further big falls," he said.
Olivier
Jakob, a Petromatrix strategist, said: "It's really the first supply
management decision taken since November 2014, so even though there will
be some that will try to discount it and say it's not a cut, it's a
change. It is a big change in policy."
Oil-producing nations have had to cut spending, increase deficit forecasts and push through politically unpopular reforms.
Venezuela's
oil minister, Eulogio Del Pino, has visited major oil producers in
recent weeks to rally support for the idea of freezing production at
current levels in an effort to stabilise prices.
Shortly after
Tuesday's announcement, Mr Del Pino said he would travel to Tehran to
meet with ministers from Iraq and Iran on Wednesday.
Over the weekend Iran started its first exports to Europe since the lifting of western sanctions last month.
Iran has said it wants to increase supply in an effort to regain market share.
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