From Blood Sugar is Stable:-
In a healthy person, BG (blood glucose) is held at a fairly constant value with slowly-varying glucose inputs (except after high-GL meals, which produce rapidly-varying glucose inputs) by a NFB (negative feed-back) loop. See Blood Glucose, Insulin & Diabetes.
When protein is eaten, this produces a glucagon response from pancreatic alpha cells, which tries to raise blood glucose level by stimulating the liver to convert liver glycogen plus water to glucose. Protein also produces an insulin response from pancreatic beta cells, which tries to lower blood glucose level by a) increasing glucose uptake from the blood and b) inhibiting HPG (hepatic glucose production). The net result is no change in BG level.
In extended fasting or on VLC (very low carbohydrate)/ketogenic diets, there's no liver glycogen left after ~1 day.
∴ The glucagon response has no effect on HGP.
The insulin response still has an effect, until physiological IR* develops.
∴ Blood glucose tries to decrease, but the HPAA keeps it steady by raising cortisol level.
RE How eating sugar & starch can lower your insulin needs: Blood glucose level on a VLC/ketogenic diet can be RAISED, due to the BG NFB HPAA (hypothalamic pituitary adrenal axis) loop not having a precise set point with the cortisol/adrenaline response (hyperglycaemia is not fatal, whereas hypoglycaemia can be fatal, as the brain always needs some glucose to function (~50%E from glucose)).
So, how come people on LCHF (low carbohydrate, high fat) diets can have normal or slightly low BG levels?
1. Luck. The BG NFB HPAA loop isn't very precise.
2. Excessive intake of Booze. Ethanol inhibits HGP (dunno about RGP (renal glucose production)).
3. Insufficient intake of Protein. This deprives the liver & kidneys of glucogenic amino acids (Alanine & Glutamine are the 2 main ones), forcing BG down and making the HPAA run open-loop and raise cortisol level. There's another source of Alanine & Glutamine available - Lean Body Mass. Uh-oh!
Consuming more protein on extended fasting or a VLC/ketogenic diet can result in higher BG level for three reasons.
1. It allows the HPAA to run closed-loop, as it's supposed to.
2. The lack of a 1st phase insulin response in people with IR/IGT/Met Syn/T2DM* results in a temporary BG level spike with the intake of rapidly-absorbed proteins e.g. whey. There's an unopposed glucagon response, until the 2nd phase insulin response begins.
*Long-term drastic carbohydrate restriction kills the 1st phase insulin response! See http://carbsanity.blogspot.co.uk/2013/10/insulin-secretion-in-progression-of.html
P.S. This only applies to people who have sufficient liver glycogen, due to them eating some (50 to 100g/day, say) carbohydrate.
3. Hepatic Insulin Resistance results in the insulin response inadequately suppressing Hepatic Glucose Production. As 50g of protein (an 8oz steak, say) yields ~25g of glucose from glucogenic amino acids, there's an increase in the amount of glucose entering circulation, which raises BG level.