Saudi Arabia Defers Pakistan’S Oil Dues Ahead Of Imf Review

Saudi Arabia has granted Pakistan an oil import financing facility, deferring oil payments of $1.2 billion by one year.

The Saudi Fund for Development CEO Sultan Bin Abdul Rehman Al Marshad and Kazim Niaz, secretary of the economic affairs division of Pakistan, signed the agreement in the presence of prime minister Shehbaz Sharif, state-backed Pakistan Television reported.

The deal will strengthen Pakistan’s economic resilience by securing a stable supply of petroleum products while reducing immediate fiscal burdens, the prime minister’s office said.

The Saudi facility will help Islamabad increase its foreign reserves ahead of the first review of a $7 billion International Monetary Fund (IMF) bailout in March, Reuters reported.

In December 2024, the fund renewed its $3 billion deposit with Pakistan’s central bank for another year to boost the country’s foreign exchange reserves and strengthen its economy.

SFD has financed 18 development projects and programmes in Pakistan valued at more than $1 billion. 

Last month, Pakistan agreed on terms for a $1 billion loan with two Middle Eastern banks at a 6-7 percent interest rate, its finance minister Muhammad Aurangzeb said,

Islamabad faces a $26 billion debt servicing obligation in the current fiscal year, Dawn, a Pakistani English daily, has reported.