Islamabad (Web Desk): Pakistan has formally requested Saudi Arabia to extend its deferred oil payment facility for an additional year, while also proposing to increase the credit period from one year to two years or more. Talks between Pakistan’s economic team and Saudi officials are ongoing, with a final decision expected soon.
Currently, Pakistan and Saudi Arabia have a deferred oil payment facility worth $1.2 billion, valid until February 2026, under which Pakistan receives $10 million per month. According to the agreement, the final installment will be received in February 2026, and Pakistan will begin repaying the loan from March 2026.
Prime Minister Shehbaz Sharif has requested Saudi leadership to continue the oil facility to reduce pressure on Pakistan’s balance of payments and facilitate external payments.
A key Pakistani economic delegation is in Saudi Arabia, discussing bilateral relations and investment opportunities with Saudi investors. At present, Pakistan holds $5 billion in Saudi deposits, of which $2 billion maturing in December 2025 has already been rolled over for one year. The remaining $3 billion, maturing in June 2026, is under negotiation for extension.
Officials from Pakistan’s Finance Ministry stated that the rollover of the $3 billion deposit is expected without any obstacles. Under the Saudi Fund for Development, Pakistan continues to receive $10 million per month. So far, Pakistan has received a total of $1.2 billion under the current arrangement. This facility is also part of the IMF Extended Fund Facility program, aimed at easing external payment pressures.
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Reliable sources noted that Saudi Arabia has not immediately approved the request and has asked for more time for consideration. During discussions, Saudi officials emphasized structural reforms, sustainable economic growth, and stability, while investment opportunities were also discussed.
The Pakistani government appreciated Saudi Arabia’s continued economic cooperation, and Saudi officials praised Pakistan’s institutional reform efforts. Both countries acknowledged the broad potential for investment and business partnerships.
If Saudi Arabia approves the extension of the deferred oil payment facility, Pakistan could receive an additional $1.2 billion this year, with the facility continuing until February 2027.
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