It gets worse. In 1979 U.S. allies called for the removal of price controls to bring down the price of oil. The critics asserted that the controls raised the world's demand for oil while depressing production by those outside the OPEC cartel. The consequence was a higher price for oil. Today electricity price controls have the same effect.
Conservation is discouraged and low-cost production is shut down.
The gap between supply and demand is filled with output from very high-cost facilities. See Economic Studies research on Regulatory and Tax Policy. President Carter deserves credit for finding a way out of the mess in 1979. He took the bold and controversial step of removing price controls on oil but at the same time proposed a windfall profits tax on producers, which Congress enacted in 1980. The proceeds were recycled to consumers and to support of development of alternative energy sources.