Saudi Arabia agrees to defer Pakistan's $5.9 billion oil payments

[Naveed Yaseen]

LONDON: Saudi Arabia has agreed to defer payments for the crude oil sales to Pakistan worth $5.9 billion during Pakistan's current July-June financial year, a British daily reported on Saturday.

"There is an agreement to defer oil payments. The modalities are being worked out," Pakistan's de facto finance minister Naveed Qamar was quoted as saying in an interview on Friday night.

Qamar would not discuss the time span for which payments on Saudi oil shipments would be deferred, but an official from the petroleum ministry in Islamabad separately told the British daily that the agreement involved deferring payments until at least June 2009 when the financial year ended.

It was not clear if the deferred payments would be paid back. One western diplomat familiar with Saudi ties to Pakistan said the Saudis in 1998 began supplying crude oil under a deferred payment plan after Pakistan carried out its maiden nuclear tests and came under international sanctions.

Saudi Arabia supplies 40 million-barrel crude oil to Pakistan annually.

http://www.thenews.com.pk/updates.asp?id=49513