Löfven will meet with representatives of the Saudi royal family, the foreign minister, and with the country's commission for human rights.
"Saudi Arabia is an important political and economic player with a key role for development and safety in the region. The situation in Syria will be prioritised issue during the talks. I also see good opportunities for an increased exchange, within for instance innovation and sustainability issues," the PM wrote in a statement.
The business leader Marcus Wallenberg, and Maria Rankka, CEO of the Stockholm Chamber of Commerce, will accompany Löfven on the trip.
The diplomatic ties between Sweden and Saudi Arabia collapsed in the early spring of 2015 when Sweden's Foreign Minister Margot Wallström called Saudi Arabia a dictatorship and criticised the lack of human rights for women, reports TT news agency.
"There has been a certain turbulence since Margot Wallström was so clearly sharp in her criticism of the human rights situation in Saudi Arabia. It is widely known that Saudi Arabia was offended by this," the Social Democrat political scientist Ulf Bjereld told Swedish Radio.
Swedish Radio News has also learnt that the prime minister will be visiting Iran, Saudi Arabia's arch-rival, early in 2017. This trip has not publicly announced by the government. It is understood to be linked to Swedish preparation for its seat on the UN Security Council.