Prime Minister Salam Fayyad said the aid was approved ahead of the Palestinian effort to win statehood recognition at the United Nations, Gulf News reported Tuesday.
The effort has prompted the United States to consider cutting off financial aid to the Palestinian Authority if the leadership proceeds with its statehood initiative.
In addition, Israel has threatened to suspend the transfer of tax revenues collected on behalf of the Palestinians.
"We are happy with the Saudi announcement of the money transfer," said Sameer al-Hourani, a Palestinian employee. "The Palestinians were just right to depend on their Arab brothers."