Modern Imperialism
Banned
Even if it isn’t in the mainland as much could Libya become like the Italian promise lands. Italians and Europeans there are given such nice standards of living by government oil money and public projects to make them more loyal and willing to put down Arab resistance when asked? Also would Italy like invest a lot more in tourism industry. Most oil authoritarian regimes are hindered greatly by religious and cultural beliefs on that. Would Mussolini or his successor invest in creating resorts, gambling, prostitution, drinking, and anything else that would attract wealthy people to Libyan coast? After Mussolini dies and Italian American businessmen go to Libya to make money I could see the mafia rising again like otl and possibly with US support(to undermine the fascist or influence Italian politics. Also corruption will be high so then coming back isn’t unlikely when a more “moderate” leader takes power). Italian population in US and US possible heavy investment in the Italian oil industry on the Americans part might eventually lead to very close tied. Imagine US and Saudi relations but with a lot more public support(Italian Americans and possibly mafia too after Mussolini)In short, this.
With emphasis on the second part. Which is, by the way, what Saudi Arabia and the Emirates have been doing, to a large extent. For closer comparisons, i'd look at how Pahlavi Iran spent its oil revenue: modernization in general (especially infrastructure) and army gear as frist priority, together with luxurious lifestyle for the top brass.
Unlike the Arab Gulf States, I don't see a lot of subsidy going to the general population just to bribe them into political acquiescence, though you might see some of that in a limited way. Another closer comparandum could be Algeria.
In general, I'd expect a lot of the revenue to be squandered into very visible pet projects with propaganda value, military expansion, and an awful lot of embezzlement and pocket-lining for the regime's high-ups, as opposed to invested in other revenue-producing endeavours: this is, in general, the pattern of most authoritarian oil-producers historically, after all.