Recent high-profile deals allowing foreign drillers to tap Venezuela’s vast oil reserves have failed to quell lingering concerns about contract sanctity in a nation with a history of nationalization, said energy investment banker Dan Pickering. Restoring daily Venezuelan oil output to the 3 million-barrel mark not seen in roughly 15 years will require major injections of foreign cash, and it’s not yet clear if overseas drillers can make a go of it in the South American nation, according to Pickering, chief investment officer at Pickering Energy Partners.

“It’s going to have to be a win for the companies that go down there and spend money, and it’s not clear yet how much of a win that’s going to be,” Pickering said during a presentation at Hart Energy’s Super DUG 2026 conference in Houston on Tuesday. “At the risk of sounding un-American or something, I think there’s a lot of smoke and mirrors around Venezuela right now.”

Venezuelan oil production tanked during back-to-back socialist regimes that nationalized foreign-held assets and stacked the state-owned driller with political loyalists. Output that surpassed 3 million barrels a day at the start of the previous decade was around 1.1 million as of July, according to Goldman Sachs Group Inc.

The US government announced late last month that it obtained rights to a 35% stake in North American Blue Energy Partners, a closely held driller that holds 100-year rights to develop 17 Venezuelan oil fields. The deal shocked US oil executives and triggered a wave of unease that it may short-circuit ongoing commercial talks. Chevron Corp., the only supermajor that retained a foothold in Venezuela throughout the reign of former strongman Nicolás Maduro, signed a blockbuster deal to expand operations in the country just days later. Meanwhile, Italy’s Eni Sp A signed a contract to operate a key Venezuelan oil field. Pickering warned that turning new agreements into actual barrels of crude is a long-term process.

“This is not going to do anything in the near term to supply,” he said.