sure, if there are 2 per side, then you could pay the bounty right out of the combined team warchest.
if you want italy to have something that it owns from the start, then libya or balkans are the only choices. Trans-jordan would be a British one rather than Italian and would be just as difficult for Italy to hold as Libya, let alone take it to start. At least E Indies was controlled by Japan at some point historically, (though not at the start of the game), the historical determination of what did happen can be set aside by the changes the players make in the game i think well enough to allow EI to be for Japan (though again, not controlled by them from the start).
Brazil’s first production well opened in 1939, but wasn’t going to pump out quite enough to make the cut here, though it would direct play to more of the board and could represent mexico and texas as well without having to take the US mainland (a likely sign the axis don’t need the oil boost to win the game). In terms of drawing play to the Pacific as similar to drawing it to the south atlantic, this could be a good reason to consider E Indies.
Iraq’s oil production was ground to a halt in-war to stem the Axis’ interest and new sites were put off through out the middle east for the same reason, which is also why the Brits staged a mini-coup to keep Iraq pro-Allies (Anglo-Iraqi War). Though they knew there was oil all throughout and could have brought wells on line much earlier had the war not occurred.