🔗 Share this article Trump's Bold Statement on American Oil Funding in Venezuelan Faces Expert Skepticism. Energy analysts have expressed considerable caution regarding bullish claims that US large firms will quickly invest vast sums of dollars to fix Venezuela's broken energy sector. Requirement of Iron-Clad Protections Lacking an solid promise of financial backing from the American government, experts believe global energy giants to proceed with great care. “It seems hasty to comment on any potential investments,” an official said this weekend. The optimistic timeline of less than a year and a half has been boldly outlined. However, expert analyses paint a different picture. A Likely Schedule “It is likely going to take 36 months for any kind of output increase,” said one energy analyst. Experts believe operators would likely spend: Year one: Sorting through new operating agreements. The second year: Commencing rebuilding of equipment. The third year: Starting to boost output. This suggests an increase of around 500,000 bpd perhaps by 2029. Appetite Compared to Willingness for Spending There is a key distinction between firms' attention and their willingness to spend substantially. “In my view their attention is an eight, on a range of one to 10. But their appetite is a much lower, because there is a lack of certainty yet.” Veteran observers in the sector reinforce this sentiment. The thinking is that firms will publicly talk up the opportunity while privately moving with extreme caution. The Vast Cost The monetary outlay would be vast. Research projections suggest that increasing production by between half a million and a million bpd would require more than $10 billion in investment over several years. But, returning output to previous levels of around 2.5 million bpd could require a monumental $80 billion to $90 billion over six or seven years. The Unanswered Question of Government Backing The prospect of firms being reimbursed by the federal government has been often raised. However, specific plans on such a mechanism have not yet been announced. The absence of certainty is the main factor for the industry's caution. Firms seek safeguards against political risk and the risk that a different president could renege on any deal. “You need to be protected from political change, that we’ve experienced in Venezuela previously.” In summary, while rhetorical promises runs strong, the operational realities suggest a road of measured steps for any significant investment in the country's energy industry.