Pakistan’s struggling economy received a major financial boost as Saudi Arabia renewed its long-standing economic support, extending a $1 billion oil facility and rolling over $5 billion in deposits placed with the State Bank of Pakistan (SBP), according to confirmation from the Finance Ministry.

The extension underscores Riyadh’s continued commitment to Pakistan’s financial stability, especially as Islamabad navigates external payment challenges and limited foreign inflows.

According to official documents, the oil financing facility, valued at approximately Rs290 billion, will continue through the current fiscal year. More than Rs85 billion worth of oil, equivalent to $300 million, has already been supplied in the first three months. Saudi Arabia currently provides around $100 million worth of oil per month, or roughly Rs28.37 billion, enabling Pakistan to meet part of its import requirements without upfront payment pressure.

$5 Billion Deposits Rolled Over

In addition to the oil facility, Saudi Arabia has rolled over $5 billion in deposits with the SBP to reinforce Pakistan’s foreign exchange reserves. Of this amount, $2 billion will mature in December 2025, while the remaining $3 billion will be due in June 2026.

The deposits, which carry a 4% interest rate, are renewed annually and categorized as budgetary support loans, providing Islamabad with essential liquidity to maintain fiscal balance and investor confidence.

Finance Ministry officials noted that the Saudi deposits — equivalent to Rs1.45 trillion — play a critical role in stabilizing the country’s macroeconomic framework, especially amid efforts to meet International Monetary Fund (IMF) program conditions and sustain external financing.

A senior Finance Ministry official emphasized the significance of Riyadh’s support, saying, “Saudi Arabia’s oil and deposit support is a vital part of our balance-of-payments management. These funds help ease import-related pressures and stabilize foreign reserves.”

The renewed financial backing also reflects Saudi Arabia’s strong strategic partnership with Pakistan, particularly in areas of energy cooperation, fiscal assistance, and economic development.

Economic observers suggest that this continued support will help Pakistan manage short-term liquidity constraints, maintain currency stability, and rebuild investor confidence as it prepares for further structural reforms.