Saudi Arabia has agreed to deliver oil to Pakistan on a deferred payment basis, according to Federal Minister of Finance Shaukat Tarin, a day after the government raised the price of petroleum goods to Rs8.82.
Saudi Arabia would contribute $150 million to Pakistan on a monthly basis, according to the finance minister, and Riyadh will offer a $3.60 billion facility to Islamabad in two years.
The finance minister stated, “This sum would be used to buy oil.”
Fawad Chaudhry, the Federal Minister of Information, claimed in May that Saudi Arabia has agreed in principle to resurrect the deferred payment option for oil delivery to Pakistan.
During his visit to Saudi Arabia earlier this year, the prime minister requested that the delivery of oil to Pakistan be resumed on a long-term delayed payment basis.
Chaudhry had responded, “Yes, it’s almost done.”
Saudi Arabia had previously offered a $6 billion financial package, consisting of $3 billion in deposits with the State Bank of Pakistan and the other $3 billion in an oil facility with yearly payments postponed.
During Saudi Crown Prince Mohammad Bin Salman‘s visit to Pakistan, the prior oil facility was inked for three years. This facility went live in July 2019 with the agreement that the first year’s bill would be paid monthly and the second year’s oil would be purchased on a deferred payment basis.
As a result, when the third-year oil supply matures, the entire facility will come to an end in the fourth year. It was estimated at the time that Pakistan would require a $275 million oil facility from Saudi Arabia on a monthly basis, totaling $3.2 billion over a three-year period.