Could the Government Control the Price?

Producing more and using less are market-based approaches to independence. But is it possible for the government to control the domestic price of oil directly, and stop price shocks that way?

Price Controls. In 1971, even before the OPEC crisis, President Richard Nixon imposed a wage and price freeze. The oil price controls on domestically produced oil lasted until President Jimmy Carter announced on April 5, 1979:

Federal Government price controls now hold down our own production and they encourage waste and increasing dependence on foreign oil. …. I’ve decided that phased decontrol of oil prices will begin on June 1 and continue at a fairly uniform rate over the next 28 months.

Lower prices sounded good, but they caused anti-conservation and decreased supply. Price controls worked against the two forces that saved us from OPEC.