FXStreet (Mumbai) - OPEC members will gather in Vienna tomorrow to decide on oil output. The International Energy Agency said the oil price plunge since June 2014 that has reduced OPEC revenue by nearly $500 billion a year is the result of excessive pumping. The market share strategy championed by Saudi Arabia was announced by OPEC in November 2014. Oil rich Saudi Arabia to push American shale oil producers out of the market has abandoned its policy of reducing supplies to stabilize price. The OPEC at the behest of Saudi Arabia and few other rich oil producing nations decided to increase production to defend market share rather then cut output to prop up prices. Saudi officials considered maintaining its market share more important than supporting prices. It therefore pumped more than 10 million barrels a day for most of 2015. This, together with new flows from Iraq resulted in OPEC pumping almost at capacity. A situation where global supplies of oil outpaced demand by more than 1 million barrels on any given day, thus surfaced. Prices, as a result plummeted. The U.S. benchmark fell below $40 a barrel yesterday. The collapse in oil prices that led to reduction in OPEC’s revenue has hurt less affluent OPEC members like Algeria, Angola, Ecuador, Nigeria and Venezuela. Venezuela's oil minister has warned that oil price could touch as low as $25 if OPEC does not stop pumping. These oil exporting nations that cannot afford the losses incurred from the oil price slump have requested the OPEC to take a stand on output level. OPEC said it will cut output at its 4th December meeting only if the non-OPEC members agree to tread similar line. Non-OPEC countries have had so far refused to cut output. Saudi Arabia will cut output only if others decide to follow suit As oil prices continues its decline, Saudi Arabia and its Persian Gulf allies expressed their decision to slash output to stop the oil price slump but they would not take any step in the said direction unless other producers like Iran, Iraq and Russia pledges to do the same. A Gulf official admitted that Saudi Arabia saw the need to curb supplies. He however exclaimed “We cannot cut alone”. Saudi Arabia is apprehensive of slashing price alone as it had an unpleasant experience three decades back in the 1980s. Saudi Arabia back then had cut output from more than 10 million barrels per day at the beginning of the decade to less than 2.5 million barrels in 1985-86. However the others in OPEC as well those outside OPEC did not do the same. As a result prices slumped and led to 16 years of Saudi budget deficits. The Saudi oil minister is thus careful this time. He has stated that that he would listen to OPEC members before deciding on a course of action. Saudi Arabia-Iran faceoff likely at OPEC’s meeting tomorrow OPEC’s meeting tomorrow will likely witness a showdown between Saudi Arabia and Iran, two oil powerhouses of the middle-east region. Iran wants Saudi Arabia to cut back its record levels of oil production as it itself prepares to increase its crude exports when western sanctions are lifted next year. Iran, so far has not shown any interest to cut production. An Iranian official argued “We’ve already reduced our production due to sanctions,” referring to the 1 million barrels a day of output the country lost after sanctions were imposed in 2012. The official said the Saudis benefited from Iran’s loss. State oil ministers meet today OPEC officials planned a meeting of state oil ministers today ahead of their planned gathering on 4th December. The objective is to decide on production levels. “It’s going to be a very tough meeting,” an OPEC national delegate said, highlighting the need to “thrash out” differences ahead of the official meeting. For more information, read our latest forex news.