“Beginning in late 1926, the rapid development of the large Seminole field in Oklahoma made the pendulum swing the other way. Voluntary proration­ was first tried with little success. Local producers appealed to the Oklahoma Corporation Commission for compulsory action. Output of one‑half million barrels per day was driving prices down, which threatened many firms.”

Mandatory proration, a government intervention re­stricting open‑flow production to a predetermined “market demand,” began almost simultane­ously in the sister oil states of Oklahoma and Texas in 1927. Other important oil states followed – except for California and Illinois that either practiced voluntary production cutbacks or none at all. [1]

California’s  free-market position did not result from free-market ideology; it was the victory of integrated Standard Oil of California (now Chevron) over the dogged mandatory-proration lobbying of their non-integrated rivals.…