Pakistan imported petroleum products worth $100 million on deferred payment basis under the Saudi oil facility for the seventh consecutive month in September 2022.
Official documents revealed the government has budgeted estimates of $800 million for oil imports under the Saudi oil facility. The country has imported petroleum products worth $300 million in the first three months of the current fiscal year. Saudi Arabia provided petroleum products worth $700 million to Pakistan from March to September. It also provided petroleum products worth $100 million each during March, April, May, June, July, and August 2022.
The Financing Agreement worth $1.2 billion for the import of petroleum products was signed on 29 November 2021 between the Saudi Fund for Development (SFD) and Pakistan’s Economic Affairs Division (EAD).
Under this facility, the Pak-Arab Refinery Limited (PARCO) and the National Refinery Limited (NRL) will import petroleum products up to $100 million per month from Saudi Arabia.
OPEC+ oil production cut: Pakistan stands by Saudi Arabia in wake of US criticism. The SFD has extended the financing facility for up to $100 million per month for one year to facilitate the purchase of petroleum products on a deferred payment basis.
According to the official documents, the terms of the financing include the price of purchase by the SFD and a margin of 3.80 per cent per annum. The financing agreement will initially be valid for one year, which may be extended for another year with mutual consent.