Saudi petroleum exports to Pakistan via the Red Sea reopened after drone attacks stopped a crucial pipeline, alleviating scarcity concerns as regional violence affects the country’s primary Middle Eastern supply sources, officials said on Tuesday.

Saudi Arabia resumed the operation of its East-West Pipeline that transports crude from oilfields in the Kingdom’s east to the Red Sea port of Yanbu, after it was interrupted on Sept 13 due to attacks that also suspended loadings at the export terminal.

The route helps Saudi crude avoid the Strait of Hormuz, where commerce had been severely affected since the war involving the United States, Israel and Iran broke out in February. TANKERS FROM YANBU TO PAKISTAN SAILING SOUTH THROUGH THE RED SEA AND THE BAB AL-MANDAB STRAIT TO THE ARABIAN SEA.

Reuters reported Tuesday that the East-West Pipeline had resumed at a slower rate and work was ongoing to get flows back up to their pre-war level of about 4 million barrels a day, or four percent of the world’s oil supply.

The restart helped send benchmark Brent crude down more than $2 to about $98 a barrel Tuesday, its lowest level in two weeks, while prices remain high on continuing disruption across the Middle East.

The Asian Development Bank has projected Pakistan economic growth at 3.7% for the current fiscal year, below the government’s objective of 4%.
The bank is also expecting average inflation of 8.3%, higher than the official forecast of 7%, due to probable economic disruptions from the ongoing turmoil in the Middle East.

In its Asian Development projection September 2026 projection, it noted Pakistan’s gross domestic product growth was projected to stay at 3.7pc in FY2027.

“As high energy, logistics, and agricultural input costs continue to affect domestic prices, average inflation is projected to rise to 8.3pc in FY27, above the central bank’s medium-term target range of 5pc–7pc,” it continued.

The ADB warned that Pakistan’s economic outlook could come under significant pressure from external developments. A rising Middle East conflict could add to the cost of oil imports, worsen the price hikes and employment conditions in the Gulf countries, which could cut remittance inflows by Pakistani workers.

The ADB said, “The re-imposition of austerity measures by the Pakistan government, especially if expenditure restraint is more pronounced than anticipated, could also weigh on domestic demand and economic activity and pose an additional downside risk to the economic outlook.

Other possible risks to the economy cited by the ADB are a tighter global financial environment, lower-than-expected tax revenue, climate and weather shocks to agriculture, and delays in reforms related to the energy sector and state-owned enterprises.

It is crucial to keep up the momentum on structural changes to improve the country’s fiscal and external position while helping to maintain confidence among investors, the bank added.

Economic activity in Pakistan improved during FY26 which ended June 30, 2026. Growth was 3.7% compared to 3.2% a year ago. A recovery was seen in a number of areas with strong services, rising industrial production, a resurgence in agriculture and strengthening private sector investment. However, economic activity slowed down a little in the last quarter, reflecting the effect of the Middle East crisis.

Continued reforms, better foreign-exchange reserves, renewed access to global capital markets and improvements in Pakistan’s sovereign credit ratings might assist raise investor confidence and stimulate private investment, the ADB said. Meanwhile, persistently high energy costs and uncertainties in the external environment, notably the ongoing impact of the Middle East conflict, could impede the speed of economic expansion.

The European Union (EU) and Pakistan signed three grant agreements for €65 million ($74.6 million) on Monday that would assist Islamabad attract international investment, deliver renewable energy to off-grid populations in its northwest and improve access to justice, the information ministry said.

The awards are financed through the EU’s Multiannual Indicative Program 2021-2027 and are part of Global Gateway, the European Commission’s infrastructure investment agenda.

The plan intends to mobilize up to €300 billion ($344.6 million) in public and private investment globally in the period 2021-2027 in sectors such as technology, energy and transport.

The Pakistani government is focusing on attracting more foreign investment as it tries to achieve sustainable economic growth. In 2023 it created the Special Investment Facilitation Council, a hybrid government entity comprising both civilian and military leaders, to attract international investment to vital economic sectors.

Addressing the signing, EU Ambassador Raimundas Karoblis said: “These agreements reflect the EU’s commitment to Pakistan’s economic development and investment ambitions under our flagship Global Gateway initiative.”

The first program attempts to promote foreign investment by improving the taxation structure in Pakistan and by boosting the long-term financial planning of the government.

The second would increase renewable energy in rural villages in Khyber Pakhtunkhwa (KP) province that are not connected to the national grid. It will also train to attract private investment into the energy industry of the province.

The third, building on EU assistance before, will help individuals in Khyber Pakhtunkhwa and Balochistan access police, prosecution services, courts and legal aid.

Both provinces share a border with Afghanistan and have bore the brunt of extremist strikes in Pakistan in recent years. Research and data platform South Asia Terrorism Portal recorded 176 attacks and 438 deaths in Balochistan in July, the highest number of violence in the month, while KP recorded 143 occurrences and 244 fatalities during the period.

The same program will help Pakistan’s most populous and industrialized provinces, Punjab and Sindh, to expand alternative and commercial conflict resolution with the declared purpose of making them more appealing to European and other corporations seeking to invest.

The EU’s development partnership with Pakistan focuses on economic development, climate resilience, governance, rule of law, human rights and sustainable management of natural resources, the statement stated. The European Union (EU) and Pakistan on Monday inked three grant agreements for €65 million ($74.6 million) to assist Islamabad attract international investment, deliver renewable energy to off-grid populations in its northwest and improve access to justice, the information ministry said.

The awards are supported under the EU’s Multiannual Indicative Program 2021-2027 and are part of the European Commission’s infrastructure investment initiative, Global Gateway.

The plan intends to mobilize up to €300 billion ($344.6 million) in public and private investment globally in the period 2021-2027 in sectors such as technology, energy and transport.

The Pakistani government is focusing on attracting more foreign investment as it tries to achieve sustainable economic growth. In 2023 it created the Special Investment Facilitation Council, a hybrid government entity comprising both civilian and military leaders, to attract international investment to vital economic sectors.

Addressing the signing, EU Ambassador Raimundas Karoblis said: “These agreements reflect the EU’s commitment to Pakistan’s economic development and investment ambitions under our flagship Global Gateway initiative.”

The first program attempts to promote foreign investment by improving the taxation structure in Pakistan and by boosting the long-term financial planning of the government.

The second would increase renewable energy in rural villages in Khyber Pakhtunkhwa (KP) province that are not connected to the national grid. It will also train to attract private investment into the energy industry of the province.

The third, building on EU assistance before, will help individuals in Khyber Pakhtunkhwa and Balochistan access police, prosecution services, courts and legal aid.

Both provinces share a border with Afghanistan and have bore the brunt of extremist strikes in Pakistan in recent years. Research and data platform South Asia Terrorism Portal recorded 176 attacks and 438 deaths in Balochistan in July, the highest number of violence in the month, while KP recorded 143 occurrences and 244 fatalities during the period.

The same program will also help the most populated and industrialized regions of Pakistan, Punjab and Sindh, to increase alternative and commercial conflict resolution, with the declared purpose of making them more attractive for European and other corporations seeking to invest.

The EU’s development cooperation with Pakistan covers economic development, climate resilience, governance, rule of law, human rights and sustainable management of natural resources, the statement said.