A general view shows the166th ordinary meeting of the Organization of the Petroleum Exporting Countries, OPEC, at their headquarters in Vienna, Austria on November 27, 2014.AFP PHOTO/SAMUEL KUBANI
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OPEC's decision to cede no ground to rival producers underscored the price war in the crude market and the challenge to U.S. shale drillers.The fracking boom has driven U.S. output to the highest in three decades, contributing to a global surplus that Venezuela Thursday estimated at 2 million barrels a day, more than the production of five OPEC members.Benchmark Brent crude fell the most in more than three years after OPEC's decision, sliding 6.7 percent to close at $72.58 a barrel. OPEC pumped 30.97 million barrels a day in October and has exceeded its current output ceiling in all but four of the 34 months since it was implemented, according to data compiled by Bloomberg.OPEC may now be prepared to let prices fall to force some drillers with higher production costs to stop pumping, said Julian Lee, an oil strategist who has worked in the industry for 25 years.OPEC has gone "cold turkey" on balancing the oil market, Goldman Sachs Group Inc. said in a report Thursday.It said last month that oil markets were entering a "new oil order," with OPEC retreating from its role as a swing producer.
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