Pakistan Seeks Oil Credit and Financial Support from Saudi Arabia
Pakistan has approached Saudi Arabia for significant financial and energy support as the government works to strengthen the country’s economic stability and ensure steady fuel supplies. The request comes at a time when Pakistan is managing economic reforms and trying to maintain adequate foreign exchange reserves.
3/9/20261 min read
Request for a Long-Term $5 Billion Deposit
According to recent reports, Pakistan has asked Saudi Arabia to convert the existing $5 billion deposit placed in the State Bank of Pakistan into a long-term facility lasting up to 10 years.
Currently, the deposit is rolled over periodically. By extending it to a longer timeframe, Pakistan hopes to gain more financial stability and reduce short-term pressure on its foreign reserves.
Proposal to Expand the Oil Credit Facility
Pakistan has also requested an expansion of its oil import facility from Saudi Arabia. At present, Saudi Arabia provides oil to Pakistan on deferred payments worth about $1.2 billion annually.
Islamabad has asked Riyadh to increase this facility to around $5 billion, allowing Pakistan to import more oil while paying later. The proposal also includes extending the repayment period from one year to as long as three years, which would ease pressure on Pakistan’s current account.
Additional Economic Cooperation
In addition to the deposit and oil facility, Pakistan is seeking broader financial cooperation. Discussions reportedly include potential Saudi guarantees for Pakistan’s international Sukuk bonds and other mechanisms that could help Pakistan secure financing at lower costs.
Such support would help Pakistan manage external financing needs while continuing economic reforms under its ongoing program with the International Monetary Fund.
Why This Support Matters
Energy imports make up a significant portion of Pakistan’s spending in foreign currency. Access to oil on deferred payments can help the country maintain stable fuel supplies while conserving precious foreign exchange reserves.
At the same time, long-term deposits from friendly countries can strengthen investor confidence and support Pakistan’s broader economic stabilization efforts.
Talks Are Still Ongoing
Negotiations between Pakistan and Saudi Arabia are ongoing, and no final decision has been officially announced yet. However, both countries have a long history of economic cooperation, making continued collaboration likely as discussions progress.
Disclaimer: This update is shared based on publicly available information. VOTG News is not responsible for any decisions made based on this news. The image is AI-generated only for illustration