The German Government is expected to cancel the sale of the Leopard 2 main battle tanks (MBTs) to Saudi Arabia because of opposition from the German Vice Chancellor and Economy Minister Sigmar Gabriel.
Unnamed government sources were quoted by Bild am Sonntag as saying that Gabriel has positioned himself against the deal.
"Without agreement from the economy minister, the deal has no chance," the sources said.
The sale, which was touted as one of the biggest contracts for the German armaments industry, was not sent to the German Federal Security Council for approval, according to the newspaper.
However, an economy ministry spokesperson told Agence France Presse that the government did not release information about 'individual procedural stages of possible approvals for export of munitions'.
Saudi Arabia has expressed an interest in acquiring up to 800 Leopard 2 tanks from German manufacturers Kraus-Maffei Wegmann (KMW) and Rheinmetall for an estimated €18bn.
Germany had already postponed a decision on whether or not to move ahead with the sale in 2013, Xinhua reports.
Germany has refused to sell heavy weapons to Saudi Arabia for decades because of human rights violations in the country and fears for Israel's security.
The Leopard 2 is a successor to the Leopard 1 MBT, and is designed to engage moving targets while moving over rough terrain.
Equipped with digital fire-control systems with laser rangefinders, a fully-stabilised main gun and coaxial machine gun, and advanced night vision and sighting equipment, various Leopard 2 variants are currently operational in the German Armed Forces and other European and non-European nations.
Image: The Leopard 2A5 main battle tanks of the German Army. Photo: courtesy of Bundeswehr-Fotos.