Counter intuitive.
A free market will always be more efficient than a market with government intervention and what does efficiency do to a business bottom line?
Think about a foreign producer like the Saudis competing with a US producer. The Saudis only competes with the US producer on the US market. The Saudis can drop the price it sells a barrel of crude here in the USA to undercut the domestic producer while raising the price it sells oil to Japan where US company can’t compete.
Add to that the type of crude that is produced heavy vs. light crude and where the refineries are to process the specific types of crude oil and it gets even more complicated.
The ban on domestic producers to sell overseas hurts our domestic oil and gas companies and will have the net effect of you and I paying more in the future for crude from foreign producers.
It is not just the demand market for a local supply.
The Gulf region does not have an overall glut of oil, but specific to light, sweet oil in a region with many heavy, sour based refineries.
Even before the price drop, there was concern about investing too much production into producing that specific type oil. Eliminate the restriction of the market they can sell to, and more gets produced locally. The supply will grow even more.