The international oil benchmark Brent was down by more than 5% to $40.87 a barrel. US crude futures fell 5.5% at $38.16 a barrel.

Japan`s Nikkei 225 index finished down 572.08 points, or 3.4%, at 16,275.95.

Market sentiment in Japan was also affected by an earthquake which hit the south of the country at the weekend.

Energy shares hit

Oil prices fell after a meeting of the world`s leading oil exporters in Qatar failed to secure an agreement to cap output.

Saudi Arabia, the world`s largest oil exporter, appeared willing to only freeze output if all Opec members agreed, including Iran.

But Iran maintained it would continue the increase in oil production it has followed since economic sanctions were lifted earlier this year. Iran was not at the meeting in Qatar. The next Opec meeting is scheduled to take place in June.

In Australia, the commodities-heavy benchmark S&P ASX 200 index closed down 0.4% at 5,137.10.

Shares of commodity-related firms all traded lower. BHP Billiton lost 3%, Woodside Petroleum shares fell 1.4% and shares of Rio Tinto gave up 1.5%.

In South Korea the Kospi closed down 0.3% at 2,009.10.

Elsewhere in the region, the benchmark Hang Seng index in Hong Kong was down 1.3% at 21,031.70, while in China the Shanghai Composite was trading 1.3% lower at 3,038.26.

Earthquake impact

Some shares in Japan were affected by the impact of the earthquake which hit the south of the country at the weekend.

Toyota shares closed down 4.8% after the carmaker said it was suspending production at various facilities across the country this week.

The company`s supply chain was disrupted when an earthquake hit the Kumamoto prefecture last Saturday. a region that is an important manufacturing hub for many big Japanese firms.

Electronics giant Sony has also had to suspend production at its plants there, and shares in Sony closed 6.8% lower.

Saturday`s magnitude-7.3 quake struck at 01:25 (15:25 GMT on Friday) close to the city of Kumamoto, which had been hit by a magnitude-6.4 quake on Thursday night.

Both quakes caused huge damage to roads, bridges and tunnels, and big landslides cut off remote mountain villages.

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