I am not opposed to the government intervening in the marketplace.
The alternatives are
1. Steal what ever the government needs, or
2. Set up a parallel government production to make anything the government needs.
When the government needs something, it is usually most efficient to buy it. That is intervening in the market place. If you want a strategic petroleum reserve, it makes sense to buy the petroleum from someone who’s business it is to find and produce petroleum, and to buy it at the lowest possible cost. That is, when there is low prices.
That means there has to be some consideration of what prices are low, and what prices are high. One way to make that consideration is to lay out sources, and the cost for them, and decided that prices below a key source cost is low.
Since the government intervenes in the market to buy petroleum all the time, it can also provide petroleum to the market, and make use of private capability to ship petroleum. That would be by selling petroleum from its Wyoming reserves to private parties, and buying petroleum from private parties where oil is needed (say Saudi Arabia). The effect on the overall market would be the same, and the cost of shipping would be reduced.
In control theory, you can use a ‘bang bang’ approach, where you have your brake on full, or have the accelerator down to the floor. It can be optimum in a ‘least time to arrive at a given state’ sense, but seems to agitate most passengers. It tends to pluck the system, and excites spurious motions in the system to be controlled.
Another approach is to use smooth control movements, and perhaps even long intervals when no control input is provided at all. That tends to be more acceptable. Selling oil at the market price when above a certain level, and buying oil at the market price when below a certain level would be one way to provide a stabilizing input, protect the market from some degree of price manipulation (by which the Saudi’s have become even more rich).
Fine, you are against it. Why? What is the real reason?
So you condone the use of government assets for political considerations?