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Market specialists have shown significant skepticism regarding bullish statements that US large firms will quickly pump tens of billions of dollars to fix the country's crumbling oil infrastructure.

Requirement of Solid Guarantees

Without an “iron-clad guarantee” of full reimbursement from the American government, specialists predict international firms to move with significant hesitation.

“It would be too early to speculate on any upcoming plans,” an official commented in response.

The ambitious schedule of under 18 months has been publicly proposed. However, expert analyses indicate a more cautious outlook.

A More Realistic Outlook

“It’s probably going to take multiple years for any significant output increase,” said one chief investment officer.

He suggested energy firms would likely spend:

• Initial phase: Sorting through new government and security contracts.
• Following phase: Investing in reconstruction of infrastructure.
• The third year: Starting to significantly ramp up production.

The result could be an increase of around half a million bpd perhaps by 2029.

Interest vs. Readiness for Risk

Experts make a key distinction between companies' curiosity and their readiness to commit heavily.

“I think their curiosity is an high score, on a scale of ten. However, their readiness is a much lower, because there is a lack of certainty yet.”

Seasoned diplomats in the country echo this sentiment. The thinking is that firms will politically talk up the opportunity while in practice proceeding with extreme caution.

The Enormous Cost

The monetary outlay would be vast. Research estimates suggest that increasing production by between half a million and a million barrels per day would require in excess of $10 billion in capital spending over two to three years.

But, returning output to historical levels of around 2.5 million bpd could require a monumental $80 billion to $90 billion over six or seven years.

The Outstanding Question of Federal Guarantees

The idea of firms being reimbursed by the government has been repeatedly mentioned. But, formal assurances on this proposal have so far not been provided.

Without certainty is the main factor for the sector's hesitation. Companies seek guarantees against sovereign risk and the risk that a future president could renege on any agreement.

“You need to be shielded from political change, that we’ve experienced in Venezuela before.”

Ultimately, while rhetorical confidence runs strong, the practical realities suggest a journey of extreme caution for any significant investment in the country's oil sector.