Oman: Reform, Security, and U.S. Policy 
Kenneth Katzman 
Specialist in Middle Eastern Affairs 
January 13, 2012 
Congressional Research Service 
7-5700 
www.crs.gov 
RS21534 
CRS Report for Congress
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  epared for Members and Committees of Congress        
Oman: Reform, Security, and U.S. Policy 
 
Summary 
Prior to the wave of unrest that has swept the Middle East in 2011, the United States had 
consistently praised Sultan Qaboos bin Sa’id Al Said for gradually opening the political process 
in the Sultanate of Oman, an initiative he began in the early 1980s without evident public 
pressure. The liberalization allowed Omanis a measure of representation but without significantly 
limiting Qaboos’ role as major decision maker. Some Omani human rights activists and civil 
society leaders, along with many younger Omanis, were always unsatisfied with the implicit and 
explicit limits to political rights and believed the democratization process had stagnated. This 
disappointment may have proved deeper and broader than experts believed when protests broke 
out in several Omani cities beginning in late February 2011, after the toppling of President Hosni 
Mubarak of Egypt. Still, the generally positive Omani views of Qaboos, coupled with economic 
and minor additional political reform measures and repression of protest actions, put limits on the 
unrest and eventually caused it to subside. Record turnout in the October 15, 2011, elections for 
the lower house of Oman’s legislative body suggested the unrest produced a new sense of 
activism, although with public recognition that reform will continue to be gradual.  
The stakes for the Administration and Congress in Oman’s stability are considerable. A long-time 
U.S. ally in the Persian Gulf, Oman has allowed U.S. access to its military facilities for virtually 
every U.S. military operation in and around the Gulf since 1980, despite the sensitivities in Oman 
about a U.S. military presence there. Oman is also a regular buyer of U.S. military equipment, 
moving away from its prior reliance on British military advice and equipment. Oman also has 
consistently supported U.S. efforts to achieve a Middle East peace by publicly endorsing peace 
treaties reached and by occasionally meeting with Israeli leaders in or outside Oman. It was partly 
in appreciation for this alliance that the United States entered into a free trade agreement (FTA) 
with Oman, which is also intended to help Oman diversify its economy to compensate for its 
relatively small reserves of crude oil. 
Perhaps because of the extensive benefits the alliance with Oman provides to U.S. Persian Gulf 
policy, successive U.S. Administrations have tended not to criticize Oman’s relatively close 
relations with Iran. Oman has a tradition of cooperation with Iran dating back to the Shah of 
Iran’s regime, and Oman has always been less alarmed by the perceived threat from Iran than 
have the other Gulf states. Oman’s leaders view possible U.S. military action against Iran’s 
nuclear facilities as potentially more destabilizing to the region than is Iran’s nuclear program or 
Iran’s foreign policy that supports Shiite and some other hardline Islamist movements. In 
addition, Oman has played the role of broker between Iran and the United States, most recently in 
the September 2011 release of two U.S. hikers from Iran after two years in jail there. For further 
information on regional dynamics that affect Oman, see CRS Report RL32048, Iran: U.S. 
Concerns and Policy Responses, by Kenneth Katzman. 
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Oman: Reform, Security, and U.S. Policy 
 
Contents 
Introduction...................................................................................................................................... 1 
Democratization, Human Rights, and 2011 Unrest ......................................................................... 2 
Representative Institutions and Election History ...................................................................... 3 
Electoral History ................................................................................................................. 4 
2011 Unrest: Dissatisfaction, but Not Hunger for Major Change....................................... 4 
U.S. Responses.................................................................................................................... 5 
October 2011: Election Following The Bulk of the Unrest................................................. 5 
Broader Human Rights Issues ................................................................................................... 6 
Freedom of Expression/Media ............................................................................................ 6 
Labor Rights........................................................................................................................ 6 
Religious Freedom .............................................................................................................. 7 
Advancement of Women ..................................................................................................... 7 
Trafficking in Persons ......................................................................................................... 7 
Defense and Security Ties................................................................................................................ 8 
U.S. Arms Sales and other Security Assistance to Oman.......................................................... 9 
Arms Purchases by Oman ................................................................................................... 9 
U.S. Security Aid and Its Uses .......................................................................................... 10 
Cooperation Against Islamic Militancy................................................................................... 11 
Cooperation on Regional Stability........................................................................................... 12 
Iran .................................................................................................................................... 12 
Iraq .................................................................................................................................... 13 
Arab-Israeli Issues............................................................................................................. 14 
Yemen................................................................................................................................ 15 
Other GCC and Regional Issues: Bahrain, Libya, and Syria ............................................ 15 
Border Disputes with Neighbors ....................................................................................... 15 
Economic and Trade Issues............................................................................................................ 16 
 
Figures 
Figure 1. Map of Oman.................................................................................................................... 2 
 
Tables 
Table 1. Some Key Facts on Oman.................................................................................................. 1 
Table 2. Recent U.S. Aid to Oman................................................................................................. 11 
 
Contacts 
Author Contact Information........................................................................................................... 17 
 
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Oman: Reform, Security, and U.S. Policy 
 
Introduction 
Oman is located along the Arabian Sea, on the southern approaches to the Strait of Hormuz, 
across from Iran. Except for a brief period of Persian rule, Omanis have remained independent 
since expelling the Portuguese in 1650. The Al Said monarchy began in 1744, extending Omani 
influence into Zanzibar and other parts of East Africa until 1861. A long-term rebellion led by the 
Imam of Oman, leader of the Ibadhi sect (neither Sunni or Shiite and widely considered 
“moderate conservative”) ended in 1959; Oman’s population is 75% Ibadhi. Sultan Qaboos bin 
Sa’id Al Said, born in November 1940, is the eighth in the line of the monarchy; he became 
Sultan in July 1970 when, with British support, he forced his father to abdicate.  
The United States signed a treaty of friendship with Oman in 1833, one of the first of its kind 
with an Arab state. This treaty was replaced by the Treaty of Amity, Economic Relations, and 
Consular Rights signed at Salalah on December 20, 1958. Oman sent an official envoy to the 
United States in 1840. A U.S. consulate was maintained in Muscat during 1880-1915, a U.S. 
embassy was opened in 1972, and the first resident U.S. Ambassador arrived in July 1974. Oman 
opened its embassy in Washington in 1973. Sultan Qaboos was accorded a formal state visit in 
April 1983 by President Reagan. He had previously had a U.S. state visit in 1974. President 
Clinton visited briefly in March 2000.  
Table 1. Some Key Facts on Oman 
Population 
2.97 million, which includes 577,000 expatriates (July 2010 estimate) 
Religions 
Ibadhi Muslim, 75%; other, 25% (Sunni Muslim, Shi te Muslim, Hindu) 
GDP (purchasing power 
$76.53 billion (2010) 
parity, PPP)  
GDP per capita (PPP) 
$25,800 (2010) 
GDP Real Growth Rate 
3.6% (2010) 
Unemployment Rate 
15%  
Inflation Rate 
4.0% (2010), down from 12.5% in 2008 
Oil Production 
863,000 barrels per day  
Oil Reserves 
5-5.5 billion barrels (2011 estimate) 
Oil Exports 
750,000 barrels per day (bpd) 
Natural Gas Production 
875 billion cubic feet/yr (2009) 
Natural Gas Reserves 
30 trillion cubic feet  
Natural Gas Exports  
407 billion cubic feet/yr 
Foreign Exchange and 
$14 billion (as of the end of 2010) 
Gold Reserves 
Energy Structure 
Petroleum Development Oman (PDO) controls most oil and natural gas resources. 
PDO is a partnership between the Omani government (60%), Royal Dutch Shel  
(34%), Total (4%), and Partx (2%). Oman Oil Company is the investment arm of the 
Ministry of Petroleum.  
 
Sources: CIA, The World Factbook; Energy Information Administration Country Analysis Brief, 2011. 
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Figure 1. Map of Oman 
 
Source: CRS. 
Democratization, Human Rights, and 2011 Unrest1 
Oman remains a monarchy in which decision-making still is largely concentrated with Sultan 
Qaboos, even though he has a reputation for benevolence and has been considered highly popular. 
Along with political reform issues, the question of succession had long been central to observers 
of Oman. Qaboos’ brief marriage in the 1970s produced no children, and the Sultan, who was 
born in November 1940, therefore has no heir apparent. According to Omani officials, succession 
would be decided by a “Ruling Family Council” of his relatively small Al Said family (about 50 
male members). If the council fails to reach an agreement, a succession letter written by Qaboos 
                                                                  
1 Information in this section is from several State Department reports: The Human Rights report for 2010 (April 8, 
2011); the International Religious Freedom Report for July—December, 2010 (September 13, 2011); and the 
Trafficking in Persons Report for 2011 (June 27, 2011).  
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prior to his death, likely to be influential for the council deliberations, would be determinative. 
The presumed successor is Minister of Heritage and Culture Sayyid Haythim bin Tariq Al Said, 
although some assess him as indecisive and often absent from his post. In part to have an 
effective governing structure in place should Qaboos leave the scene suddenly, some are pressing 
Qaboos to name a prime minister (Qaboos himself holds this position). Among the possibilities 
mentioned is the secretary general of the Foreign Ministry, Sayyid Badr bin Harib Al Busaidi, 
who is said to be efficient and effective.2  
Despite the three-decade-long opening of the political process discussed below, in recent years 
some Omanis, particularly younger, well-educated professionals, considered the pace of 
liberalization too slow. Many older Omanis, on the other hand, tend to compare the current degree 
of “political space” favorably with that during the reign of the Sultan’s father. Under the Sultan’s 
father, Omanis needed the Sultan’s approval to wear spectacles, for example. Among those who 
have been critical of the pace of political liberalization, some, even within the government and 
official establishment, noted that many top positions have been filled in recent years by former 
security officials, replacing academics or other professionals. Others saw progress in the holding 
in April 2009 of a two-day workshop in Muscat to discuss freedom of speech.3 However, 
evidence that the pace of change has been perceived as slow was demonstrated in 2011 in the 
form of protest in several cities, following unrest sweeping other parts of the region.  
Representative Institutions and Election History 
Many have praised Sultan Qaboos for creating legislative institutions and an election process long 
before there was any evident public pressure to do so, although the process has advanced 
incrementally. Under a 1996 “Basic Law,” Qaboos created a bicameral “legislative” body called 
the Oman Council—consisting of an elected Consultative Council (Majlis As Shura), and an 
appointed State Council (Majlis Ad Dawla). The Consultative Council was first established in 
November 1991, replacing a 10-year-old advisory council, and had an initial size of 59 seats. It 
has been gradually expanded and now has 84 elected members. The State Council, which had 53 
members at inception, has 59 appointed members as of 2005. Many of the appointees tend to be 
former high-ranking government or military officials, such as ex-ambassadors.  
The Oman Council’s scope of authority has long been constrained. When it was created, it was 
not given power to draft legislation, lacked binding power to overturn the Sultan’s decrees or 
government regulations, and was generally confined to economic and social issues. Within the 
Oman Council, the State Council serves as a further check and balance on actions by the 
Consultative Council, although some believe it acted to limit impulsive excess of the elected 
body. Prior to the outbreak of unrest in Oman in 2011, some Omanis were saying in interviews 
that the Oman Council’s influence over policy had diminished over time—to the point where 
many experts said Oman was lagging the other Gulf states on political liberalization. As in the 
other Gulf states, formal political parties are not allowed. Unlike Bahrain or Kuwait, there are no 
clear currents or factions within either of the two chambers that make up the Oman Council.  
                                                                  
2 Author conversation with Omani Foreign Ministry consultant and unofficial envoy. May 5, 2011. This official has a 
name nearly identical to that of the Minister of State for Defense, but they are two different officials.  
3 Slackman, Michael. “With Murmurs of Change, Sultan Tightens His Grip.” New York Times, May 15, 2009.  
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Electoral History 
Beyond expanding the size of the two chambers, Qaboos has gradually enfranchised Omanis to 
select the membership of the elected Consultative Council. In the 1994 and 1997 selection cycles 
for the council, “notables” in each of Oman’s districts chose up to three nominees, with Qaboos 
making a final selection for the council. The first direct elections to it were held in September 
2000 (then a three-year term), but the electorate was limited (25% of all citizens over 21 years 
old). In November 2002, Qaboos extended voting rights to all citizens, male and female, over 21 
years of age, and the October 4, 2003, Consultative Council elections—in which 195,000 Omanis 
voted (74% turnout)—resulted in a council similar to that elected in 2000, including the election 
of the same two women as in the previous election (out of 15 women candidates). 
In the October 27, 2007, election (after changing to a four-year term), Qaboos allowed public 
campaigning. Turnout among 388,000 registered voters was 63%, including enthusiastic 
participation by women, but none of the 21 female candidates (out of 631 candidates) won. 
Qaboos appoints the Consultative Council president (he appointed a new president in September 
2007, Shaykh Ahmad bin Mohammad Al Isa’i, replacing a 16-year incumbent), although the 
Consultative Council chooses two vice presidents. On March 17, 2011, two new vice presidents 
were selected by the council membership—Yunis bin Sabil Al Balushi, and Abdullah bin Khalifa 
Al Majali.  
2011 Unrest: Dissatisfaction, but Not Hunger for Major Change  
Although observers have long assessed Omanis as willing to overlook the limits to their political 
rights, evidence has appeared in 2011 that many Omanis are dissatisfied with the pace of political 
change. About two weeks after Egyptian protests toppled President Hosni Mubarak, protests 
broke out in the northern industrial town of Sohar, Oman. On February 26, 2011, several hundred 
demonstrators gathered there demanding better pay and more job opportunities; two were killed 
when security forces fired rubber bullets. Protests expanded in Sohar over the next few days, 
including the burning of cars and some shops, and spread to the capital, Muscat. Although most 
protesters said their demonstrations were motivated by economic factors—particularly a lack of 
available good jobs—some say they wanted the powers of the Majles expanded to approximate 
those of a Western legislature. However, few, if any, called for Qaboos to step down, even after 
the deaths of some protesters. Some protesters even displayed posters with his picture. Protests 
continued in Sohar and in Muscat throughout most of March, including establishment of an 
encampment in Sohar’s main square.  
By the end of March, Qaboos appeared to have calmed much of the unrest through a series of 
measures. On March 29, 2011, he sent security forces to clear the protesters from their gathering 
places in Sohar. However, he also tried to address grievances in several ways, including with a 
minor cabinet reshuffle on February 26 and then a more extensive change of 12 out of 29 
ministries on March 7, 2011. In the first of the cabinet changes, he added a woman (Madiha bint 
Ahmad bin Nasser) as education minister. He also sent representatives to meet with protesters, 
ordered that 50,000 new public sector jobs be created immediately, raised the minimum wage by 
about one-third (to about $520 per month), and ordered that about $400 be given to unemployed 
job seekers. He also decreed that the office of public prosecutor will have independence from 
government control, that there will be new consumer protections, and, as noted below, expanded 
the powers of the Oman Council. These moves followed an earlier mandated increase in private 
sector minimum wages of 43% at the beginning of February.  
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Protests abated by April 1, but did not end totally, and tensions remained high. On April 7, a small 
group of protesters outside the Oman Council headquarters in Muscat called for an investigation 
of the security forces for the killing of the two protesters in March (see above). Activists using e-
mail and other electronic media called for protests in Sohar on Friday, April 8, but a heavy 
security presence prevented fresh protests. During late April until mid-May, protests, some said to 
be large, were held after each Friday prayers in the city of Salalah. Salalah is the capital of the 
Dhofar region, which was in rebellion against the Omani central government until the mid-1970s. 
Protests have been relatively few, but not absent, since. Possibly as a signal that the government 
is committed to ensuring economic well-being and to head off any revival of major protests, in 
August 2011, the government announced plans to increase spending by 9% in 2012 to finance 
construction projects and more jobs for nationals. A freeze on prices of certain goods, imposed 
August 18, 2011, could also have been intended to dampen further unrest.  
Still, some unrest continues. Since mid-December 2011, twenty two jailed protesters (out of 50 
who have been jailed to date for protesting) have been on a hunger strike. They are taking this 
action because they believe their sentences are too long for the offense committed and are 
demanding their release. In January 2012, the government announced plans to boost its 
expenditures by about 26% to provide for jobs, social security, and unemployment benefits—an 
apparent further budgetary effort to head off any resurgence of unrest.  
U.S. Responses 
The U.S. reaction to the unrest in Oman was muted, possibly because Oman is a key ally of the 
United States and perhaps because the unrest appeared minor relative to the rest of the region. 
There have not been critical U.S. statements issued about Oman’s responses to the unrest. On 
June 1, 2011, after the unrest had begun, and after some government force had suppressed 
protests, the U.S. Ambassador gave an interview to an Omani paper, saying: “This certainly has 
been a fascinating time to serve in the Middle East. The entire region, including Oman, has 
witnessed enormous change in an extremely brief period of time. Sultan Qaboos was quick to 
recognize and respond to the needs of Omanis. The way in which he responded to the concerns of 
the Omani people is a testament to his wise leadership.”4  
October 2011: Election Following The Bulk of the Unrest 
The unrest affected the political landscape in the run-up to the October 2011 scheduled 
Consultative Council elections. As part of his reaction to 2011 unrest, on March 13, 2011, Qaboos 
issued a decree granting the Oman Council legislative and regulatory powers. Even though a 
committee formed to recommend new powers has not made recommendations seven months after 
its formation, there is public expectation that the council formed after the October 2011 election 
could be at least somewhat more influential in decisionmaking than is the current council. This 
perception raised the stakes for candidates and voters in the Consultative Council elections and 
State Council appointments. The election date was set as October 15, 2011. 
As of the filing deadline, a total of 1,330 candidates had announced their candidacies. This is a 
70% increase from the number of candidates in the 2007 vote and suggests that the 2011 unrest 
had increased political activism and attracted candidates inspired by the increase in the Oman 
                                                                  
4 http://oman.usembassy.gov/pr-06012011.html 
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Council’s powers. A record 77 women filed candidacies, compared to the 21 that filed in the 2007 
vote.  
The high turnout in the election (about 76%, substantially higher than the 2007 vote) suggested 
increased citizen enthusiasm for participation and appeared to rebut analysis from critics who felt 
that the citizenry would shun the political process that produces only gradual reform. Of the 
520,000 Omanis who registered to vote, about 400,000 voted. Hopes among many Omanis that at 
least several women would win were dashed—only one was elected, a candidate from Seeb 
(suburb of the capital, Muscat). However, two political activists—Salim bin Abdullah Al Oufi, 
and Talib Al Maamari, an academic, were elected. The government hailed the turnout as evidence 
of its popularity and an endorsement of its handling of the 2011 protest movement.  
In December 2011, after the election, the State Council began examining a proposal to establish a 
constitutional court or, alternatively, a separate department of the Supreme Court that would rule 
on constitutional matters. The proposal is viewed as a response to the causes of the unrest.  
Broader Human Rights Issues 
The government’s practices on numerous other issues affect popular sentiment in Oman. The 
State Department human rights report for 2010 repeated previous years’ assertions that “the 
government generally respect[s] the human rights of its citizens.” However, there are restrictions 
by law, by custom, and in practice. On November 17, 2008, Oman set up its first human rights 
commission as an “autonomous body” attached to the State Council. U.S. funds from the Middle 
East Partnership Initiative and the Near East Regional Democracy account (both State 
Department accounts) have been used to fund civil society and political process strengthening, 
judicial reform, election management, media independence, and women’s empowerment. 
Freedom of Expression/Media 
Press criticism of the government is tolerated, but criticism of the Sultan (and by extension, 
government officials in general) is not. Private ownership of radio and television stations is not 
prohibited, but there are very few privately owned stations, with the exception of Majan TV, and 
three radio stations: HiFM, HalaFM, and Wisal. However, availability of satellite dishes has made 
foreign broadcasts accessible to the public. There are some legal or practical restrictions to 
Internet usage, and only about 8%-13% of the population has subscriptions to Internet service. 
Many Internet sites are blocked, primarily for offering sexual content, but many Omanis are able 
to bypass restrictions by accessing their Internet over smart cell phones.  
Human rights organizations, including Human Rights Watch, criticized and called for an 
overturning of an Omani lower court decision in September 2011 to close for one month a 
prominent newspaper, Az Zaman, and to jail two of its editors. The sentences were for allegedly 
insulting the justice minister in articles about corruption and abuses in that ministry.  
Labor Rights 
On labor issues, the State Department notes improving workers’ rights, in conjunction with the 
U.S.-Oman FTA, and the labor laws permit collective bargaining and prohibit employers from 
firing or penalizing workers for union activity. Workers have the legal right to strike, but strikes 
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are subject to requirements, including an absolute majority of workers in an enterprise needed to 
call a strike. Labor rights are regulated by the Ministry of Manpower.  
Religious Freedom 
The 1996 Basic Law affirmed Islam as the state religion, but provides for freedom to practice 
religious rites as long as doing so does not disrupt public order. The State Department’s religious 
freedom report for July-December 2010 noted “no change in the status of respect for religious 
freedom by the government during the reporting period.” According to the report, “There were no 
significant reports of societal abuses or discrimination based on religious affiliation, belief, or 
practice [during the reporting period].” Non-Muslims are free to worship at temples and churches 
built on land donated by the Sultan, but there are some limitations on non-Muslims’ proselytizing 
and on religious gatherings in other than government-approved houses of worship.  
All religious organizations must be registered with the Ministry of Endowments and Religious 
Affairs (MERA). Among non-Muslim sponsors recognized by MERA are the Protestant Church 
of Oman; the Catholic Diocese of Oman; the al Amana Center (interdenominational Christian); 
the Hindu Mahajan Temple; and the Anwar al-Ghubairia Trading Co. Muscat (for the Sikh 
community). The government agrees in principle to allow Buddhists to hold meetings if they can 
find a corporate sponsor. Members of all religions and sects are free to maintain links with 
coreligionists abroad and travel outside Oman for religious purposes. Private media have 
occasionally published anti-Semitic editorial cartoons. 
Advancement of Women 
Sultan Qaboos has given major speeches on the equality of women and their importance in 
national development, and they now constitute about 30% of the workforce. Since 2004, there 
have been four women of ministerial rank, of whom three are in the cabinet (the ministers of 
higher education, of tourism, and of social development). They were joined in February 2011 by a 
new minister of education, as discussed below. The first woman ever of ministerial rank in Oman 
was appointed in March 2003; she heads the national authority for industrial craftsmanship. In 
April 2004, Qaboos placed five women among the 29 appointees to the public prosecutors office. 
Also, the U.S. ambassador is a woman.  
There were 14 women in the 2007-2011 State Council, appointed following the 2007 election, up 
from nine in the 2003-2007 council. As noted, no woman was elected to the Consultative Council 
in 2007, reducing the female representation from the two that had been selected in the previous 
cycles, although one was elected in the election held on October 15, 2011.  
At the citizen level, allegations of spousal abuse and domestic violence are fairly common, with 
women finding protection primarily through their families. Omani women also continue to face 
social discrimination often as a result of the interpretation of Islamic law. 
Trafficking in Persons 
In October 2008, President Bush directed (Presidential Determination 2009-5) that Oman be 
moved from “Tier 3” on trafficking in persons (worst level, assessed in the June 4, 2008, State 
Department report on that issue), to “Tier 2/Watch List.” That determination was made on the 
basis of Omani pledges to increase efforts to counter trafficking in persons. In the report for 2010, 
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issued June 14, 2010, Oman’s “grade” remained at Tier 2—the level it was assigned in the 2009 
report. The Tier 2 ranking was repeated in the trafficking report for 2011, released June 27, 2011. 
The 2009-2011 rankings were based on an assessment that Oman is making significant efforts to 
comply with minimum standards for the elimination of trafficking and its prosecutions for those 
trafficking in persons. Still, Oman is considered a destination and transit country for men and 
women primarily from South and East Asia, in conditions indicative of forced labor.  
Defense and Security Ties 
Sultan Qaboos, who is Sandhurst-educated and is respected by his fellow Gulf rulers as a defense 
strategist, has long seen the United States as the key security guarantor of the region. He also has 
consistently advocated expanded defense cooperation among the Gulf states. Oman was the first 
Gulf state to formalize defense relations with the United States after the Persian Gulf region was 
shaken by Iran’s 1979 Islamic revolution, which it was at first feared would spread throughout the 
Middle East and lead to the downfall of monarchy states there. Oman signed an agreement to 
allow U.S. forces access to Omani military facilities on April 21, 1980. Three days later, the 
United States used Oman’s Masirah Island air base to launch the failed attempt to rescue the U.S. 
embassy hostages in Iran. During the September 1980–August 1988 Iran-Iraq War, the United 
States built up naval forces in the Gulf to prevent Iranian attacks on international shipping. Oman 
played the role of quiet intermediary between the United States and Iran for the return of Iranians 
captured in clashes with U.S. naval forces in the Gulf during that war.  
Under the U.S.-Oman access agreement, which was renewed in 1985, 1990, 2000, and 2010, the 
United States reportedly can use—with advance notice and for specified purposes—Oman’s 
military airfields in Muscat (the capital), Thumrait, and Masirah Island. Some U.S. Air Force 
equipment, including lethal munitions, is stored at these bases.5 During the renewal negotiations 
in 2000, the United States acceded to Oman’s request that the United States fund a $120 million 
upgrade of a fourth air base (Khasab) at Musnanah (50 miles from Muscat).6  
In conjunction with the 2010 renewal, the U.S. military sought to respond to an Omani request to 
move some U.S. equipment to expanded facilities at Musnanah, from the international airport at 
Seeb, to accommodate commercial development at Seeb. Conferees on the DOD authorization act 
for FY2010 (P.L. 111-84) did not incorporate into that law a DOD request for $116 million to 
carry out that move, on the grounds that U.S. Central Command had not formulated a master 
plan—or obtained an Omani contribution—for the needed further construction at Musnanah. One 
complication could be the fact that, according to observers, about 200 British military personnel 
are slated to move to Musnanah from Seeb,7 and it is unclear whether the facility can 
accommodate both U.S. and British personnel. However, some of the issues were apparently 
cleared up because the DOD authorization act for FY2011 (H.R. 6523, P.L. 111-383, signed 
January 7, 2011) authorized $69 million in military construction funding for the Musnanah 
                                                                  
5 Hajjar, Sami. U.S. Military Presence in the Gulf: Challenges and Prospects. U.S. Army War College, Strategic 
Studies Institute. P. 27. 
6 Finnegan, Philip. “Oman Seeks U.S. Base Upgrades.” Defense News, April 12, 1999. 
7 Author conversation with Muscat Daily reporter about Musnanah. April 28, 2011.  
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facility. Perhaps sensing that the Obama Administration was attempting to accommodate the 
request, the access agreements were renewed in November 2010.8  
Oman’s facilities contributed to U.S. major combat operations in Afghanistan (Operation 
Enduring Freedom, OEF) and, to a lesser extent, Iraq (Operation Iraqi Freedom, OIF), even 
though Omani leaders said that invading Iraq could “incite revenge” against the United States in 
the Arab world. According to the Defense Department, during OEF there were about 4,300 U.S. 
personnel in Oman, mostly Air Force, and U.S. B-1 bombers, indicating that the Omani facilities 
were used extensively for strikes during OEF. The U.S. presence fell slightly to 3,750 during OIF; 
other facilities closer to Iraq, such as in Kuwait, were used more extensively for OIF. There are 
approximately 20 U.S. military personnel (almost all are Air Force) in Oman as of November 
2011,9 well below the pre-September 11, 2001, figure of 200 U.S. personnel. Since 2004, Omani 
facilities reportedly have not been used for air support operations in either Afghanistan or Iraq.  
Even though the U.S. military presence in Oman has shrunk dramatically over the past decade, 
some Omani officials may want to shrink it further. That view could reflect an Omani calculation 
that the U.S. military presence angers Islamist Omanis, Iran, and members of anti-U.S. terrorist 
organizations that may operate throughout the Gulf. Some Omanis reportedly are discussing with 
U.S. officials the possibility for the U.S. military to relocate most of its personnel to Masirah 
Island, which is one of the locations covered under the Access Agreement but which is offshore 
and sparsely inhabited. On the other hand, Masirah’s runway is shorter than that of Thumrait, the 
main location used by the U.S. Air Force, and some U.S. military officials may consider Masirah 
less suitable than Thumrait.  
U.S. Arms Sales and other Security Assistance to Oman10 
Oman’s 43,000-person armed force is the third largest of the Gulf Cooperation Council states 
(GCC, including Saudi Arabia, Kuwait, UAE, Oman, Bahrain, and Qatar). Its force is widely 
considered one of the best trained but not the best equipped. However, Oman is trying to expand 
and modernize its arsenal with purchases from the United States. Because of his historic ties to 
the British military, Qaboos early on relied on seconded British officers to command Omani 
military services. British officers are now mostly advisory. Much of its arsenal still is British-
made, although it is increasingly purchasing U.S. and not British systems.  
Arms Purchases by Oman 
In an effort to modernize its Air Force, in October 2001, after years of consideration, Oman 
purchased (with its own funds) 12 U.S.-made F-16 C/D aircraft from new production. Along with 
associated weapons (Harpoon and AIM missiles), a podded reconnaissance system, and training, 
the sale was valued at about $825 million; deliveries were completed in 2006. Oman made the 
purchase in part to keep pace with its Gulf neighbors, including UAE and Bahrain, that had 
                                                                  
8 Author conversation with State Department officer responsible for Oman. January 6, 2011.  
9 Contingency Tracking System Deployment File, provided to CRS by the Department of Defense. Figures as of 
November 20, 2011.  
10 Section 564 of Title V, Part C of the Foreign Relations Authorization Act for FY1994 and FY1995 (P.L. 103-236) 
banned U.S. arms transfers to countries that maintain the Arab boycott of Israel during those fiscal years. As applied to 
the GCC states, this provision was waived on the grounds that doing so was in the national interest. 
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bought F-16s. In July 2006, according to the Defense Security Cooperation Agency (DSCA), 
Oman bought the JAVELIN anti-tank system, at a cost of about $48 million.  
Some major U.S. sales to Oman have been expected as part of an estimated $20 billion sales 
package to the Gulf states under the U.S. “Gulf Security Dialogue” intended to contain Iran, 
although most of the sales notified thus far are to the much wealthier Saudi Arabia and UAE. As 
part of that effort:  
•  The Defense Security Cooperation Agency (DSCA) notified Congress on August 
4, 2010, of a potential sale to Oman of up to 18 additional F-16s and associated 
equipment and support. The sale could be worth up to $3.5 billion to the main 
manufacturer, Lockheed Martin, which said in May 2011 that it hopes to have a 
firm contract in place with Oman by early 2012.11  
•  In November 2010, DSCA notified Congress of a possible sale of up to $76 
million worth of countermeasures equipment and training to protect the C-130J 
that Oman is buying from Lockheed Martin under a June 2009 commercial 
contract. The prime manufacturer of the countermeasures equipment is Northrop 
Grumman.  
•  On October 19, 2011, DSCA notified Congress of a potential sale to Oman of 
AVENGER fire units, Stinger missiles, and Advanced Medium Range Air to Air 
Missiles (AMRAAMs)—all of which are to help Oman develop a layered air 
defense system. The total value of the potential sale, including associated 
equipment and training, is about $1.25 billion.  
Regarding purchases from other countries, in the past three years, Oman has continued to buy 
some British equipment, including Typhoon fighter aircraft and patrol boats. It has also bought 
some Chinese-made armored personnel carriers and other gear.  
U.S. Security Aid and Its Uses  
U.S. Foreign Military Financing (FMF)—recent amounts of which are shown below—has been 
used to help Oman buy U.S.-made coastal patrol boats for anti-narcotics and anti-smuggling 
missions, as well as aircraft munitions, night-vision goggles, upgrades to coastal surveillance 
systems, communications equipment, and de-mining equipment. The International Military 
Education and Training program (IMET) program is used to promote U.S. standards of human 
rights and civilian control of military and security forces, as well as to fund English language 
instruction, and promote inter-operability with U.S. forces. Nonproliferation, Antiterrorism, 
Demining, and Related Programs (NADR) funds are used to help Oman develop controls and 
train and equip personnel to prevent proliferation and combat terrorism. In FY2011, DOD funds 
(“Section 1206” funds) are being used to help Oman’s military develop its counterterrorism 
capability through deployment of biometric data collection devices. A small portion of the funds 
($48,000) will be used to give a human rights seminar to unit commanders and key staff of 
Oman’s military.  
The United States phased out development assistance to Oman in 1996. At the height of that 
development assistance program in the 1980s, the United States was giving Oman about $15 
                                                                  
11 Andrea Shalal-Esa. “Lockheed Hopes to Finalize F-16 Sales to Iraq, Oman.” Reuters, May 16, 2011.  
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million per year in Economic Support Funds (ESF) in loans and grants, mostly for conservation 
and management of Omani fisheries and water resources.  
Provision of Excess Defense Articles (EDA) 
Oman is eligible for grant U.S. excess defense articles (EDA) under Section 516 of the Foreign 
Assistance Act. It received 30 U.S.-made M-60A3 tanks in September 1996 on a “no rent” lease 
basis (later receiving title outright). There have been minor EDA grants since 2000, particularly 
gear to help Oman monitor its borders and waters and to improve inter-operability with U.S. 
forces. In 2004, it turned down a U.S. offer of EDA U.S.-made M1A1 tanks. Some Omani 
officers say they need new armor to supplement the 38 British-made Challenger 2 tanks and 80 
British-made Piranha armored personnel carriers Oman bought in the mid-1990s. 
Table 2. Recent U.S. Aid to Oman 
(In millions of dollars) 
 
FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011  FY2012 
 
IMET  0.75 0.83 1.14  1.14  1.11 1.43  1.45 1.525 1.65  1.65 
FMF 80.0 24.85 
19.84 
13.86 
13.49 4.712 7.0  8.85 11.98  9.5 
NADR 
  
.40 0.554 0.4  1.28 1.593 0.95 1.655 1.5  1.5 
1206 
           0.948 
 
Note: IMET is International Military Education and Training; FMF is Foreign Military Financing; NADR is 
Nonproliferation, Anti-Terrorism, De-Mining and Related Programs, and includes ATA (Anti-Terrorism Assistance); 
EXBS (Export Control and Related Border Security); and TIP (Terrorism Interdiction Program). Numbers for FY2011 
reflect final allocations by State Dept.  
 
Cooperation Against Islamic Militancy 
Since September 11, 2001, Oman has cooperated with U.S. legal, intelligence, and financial 
efforts against terrorism. According to the State Department report on global terrorism for 2010, 
released August 18, 2011, Oman “took significant steps during the year to improve border 
security, as demonstrated by a number of training and border security workshops that were 
conducted in Oman.” The latest State Department report also credits Oman with transparency 
regarding its anti-money laundering and counterterrorist financing enforcement efforts, and with 
steady improvement in its legal system related to those efforts. The previous year’s State 
Department report credited Oman with convicting and sentencing to life in prison an Omani 
businessman, Ali Abdul Aziz al-Hooti, for helping to plan terrorist attacks in Oman and for 
helping to fund a Pakistan-based terrorist group, Lashkar-e-Tayyiba.  
Other relatively recent steps include Oman’s enactment of a January 2007 law establishing a 
National Committee for Combating Terrorism, a December 2006 agreement with Saudi Arabia to 
control cross-border transit, and the establishment of a financial intelligence unit of the 
Directorate of Financial Crimes of the Royal Omani Police. In September 2008, it strengthened 
its anti-money laundering program by requiring non-banking establishments to verify the identify 
of their clients and document financial transactions. In December 2004, the government arrested 
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31 Ibadhi Muslims (Omani citizens) on suspicion of conspiring to establish a religious state, but 
Qaboos pardoned them in June 2005. 
On November 22, 2005, Oman joined the U.S. “Container Security Initiative,” agreeing to pre-
screening of U.S.-bound cargo from its port of Salalah for illicit trafficking of nuclear and other 
materials, and for terrorists. As discussed above, U.S. aid to Oman (NADR funds) help Oman 
establish effective export controls, sustain its counter-terrorism training capabilities, and control 
movements of illegal immigrants across its borders.  
Cooperation on Regional Stability 
Sultan Qaboos has often pursued foreign policies outside an Arab or Gulf consensus. Some of 
Oman’s stances, such as that toward Iran, have appeared at odds with U.S. policy. Other of its 
positions, such as on the Arab-Israeli dispute, have been highly supportive of U.S. policy, 
sometimes to the extent of alienating other Arab leaders. On December 5, 2010, Secretary of 
Defense Gates visited Oman and met with Qaboos and Minister of State for Defense Badr bin 
Saud bin Harib al-Busaidi (distant relative of Qaboos) to discuss regional issues, reportedly 
including Iran and the U.S.-led mission in Afghanistan. Gates also visited the aircraft carrier USS 
Abraham Lincoln operating in the Arabian Sea off the coast of Oman.12 On February 24, 2011, 
Oman hosted Chairman of the Joint Chiefs of Staff Admiral Michael Mullen for meetings with 
Omani senior defense leaders and discussions there on Afghanistan and Pakistan with Admiral 
Mullen’s chief Pakistani counterpart, Chief of Army Staff General Ashfaq Kayani.13 
Iran 
Of the Gulf states, Oman is perceived as politically closest to and the least critical of Iran. Qaboos 
sees no inconsistency between Oman’s alliance with the United States and its friendship with 
Iran. This relationship has proved useful to the United States in the past; Oman was an 
intermediary through which the United States returned Iranian prisoners captured during U.S.-
Iran skirmishes in the Persian Gulf in 1987-1988. Oman reprised this intermediary role on 
September 14, 2010, when Iran released U.S. citizen Sara Shourd, a hiker who was arrested with 
two friends in July 2009 for crossing from Iraq onto Iranian territory. A U.S. State Department 
spokesman publicly confirmed that Oman had played a brokering role in her release, possibly 
including paying her $500,000 bail to Iranian authorities, and she flew to Oman after her release. 
Omani diplomats subsequently negotiated with Iran for the release of the other two hikers, Josh 
Fattal and Shane Bauer, the latter of which had become Sara Shourd’s fiancé during their 
incarceration. They were released on September 21, 2011, flying from Iran to Oman on their way 
back to the United States. It was subsequently reported that State Department official on Iran 
affairs, Philo Dibble, had coordinated with Oman and with Switzerland (which represents U.S. 
interests in Iran) to achieve their release; Dibble died one month later.14  
At other times, Oman’s attempts to steer a middle ground between Iran and the United States 
have caused problems for Oman. For example, in April 1980, within days of signing the 
agreement allowing the United States military to use several Omani air bases, the United States 
                                                                  
12 Gates Meets With Leaders in Oman, Plans Carrier Visit. American Forces Press Service, December 5, 2010.  
13 “Mullen, Mattis Meet With Omani Counterparts.” American Forces Press Service. February 24, 2011.  
14 Dennis Hevesi. “Philo Dibble, Diplomat and Iran Expert, Dies At 60.” New York Times, October 13, 2011.  
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used these facilities—reportedly without prior notification to Oman—to launch the abortive 
mission to rescue the U.S. Embassy hostages seized by Iran in November 1979.15  
Some accounts say that Oman is in the process of drawing closer to Iran than it has previously. 
Sultan Qaboos last visited Tehran in August 2009, his first visit there since the 1979 Islamic 
revolution. He went forward with the visit even though the June 2009 reelection of President 
Mahmoud Ahmadinejad was widely challenged in Iran as fraudulent by large numbers of 
demonstrators in Tehran and in other cities. To this extent, the Qaboos visit was viewed as a sign 
that Oman was endorsing—or at least deciding to set aside the issue of—Ahmadinejad’s 
reelection.  
Oman, as have the other GCC states, has long publicly opposed any U.S. attack on Iran’s nuclear 
facilities. Not only has Oman rebuffed efforts by the other Gulf states to persuade Oman to 
distance itself from Iran politically,16 but, on August 4, 2010, it reportedly signed a security pact 
with Iran.17 The pact reportedly commits the two to hold joint military exercises at some point. 
The United States did not criticize Oman’s entry into this pact with Iran, possibly believing that 
the agreement will not result in much significant new cooperation between the two. The 2010 
pact follows an earlier pact, signed in August 2009, that focused on cooperating against 
smuggling across the Gulf of Oman, which separates the two countries. The Oman-Iran pacts 
were ratified by Iran’s Majles (parliament) on December 20, 2010.  
Economically, the two conduct formal trade, supplemented by the informal trading relations that 
have long characterized the Gulf region. Oman’s government is said to turn a blind eye to the 
smuggling of a wide variety of goods to Iran from Oman’s Musandam Peninsula territory. The 
trade is illegal in Iran because the smugglers avoid paying taxes in Iran, but Oman’s local 
government collects taxes on the goods shipped.18 Iran and Oman are in discussions about 
potential investments to develop Iranian offshore natural gas fields that adjoin Oman’s West 
Bukha oil and gas field in the Strait of Hormuz. The Omani field began producing oil and gas in 
February 2009.  
Many observers ask why Oman is not as wary of Iran as are the other GCC states. Oman has no 
sizable Shiite community with which Iran could meddle in Oman, so the fear of Iranian 
interference is less pronounced. There are also residual positive sentiments pre-dating Iran’s 
Islamic revolution. Oman still appreciates the military help the Shah of Iran provided in helping 
end a leftist revolt in Oman’s Dhofar Province during 1964-1975. Others attribute Oman’s 
position on Iran to its larger concerns that Saudi Arabia has sought to spread its Wahhabi form of 
Islam into Oman, and Oman sees Iran as a rival to and potential counterweight to Saudi Arabia.  
Iraq 
On Iraq, and generally in line with other GCC states, Omani officials say that the Omani 
government and population are dismayed at the Shiite Islamist domination of post-Saddam Iraq 
and its pro-Iranian tilt. Iraq opened an embassy in post-Saddam Iraq but then closed it for several 
                                                                  
15 CRS conversations with U.S. Embassy officials in Oman. 1995-2003.  
16 Slackman, Michael. “Oman Navigates Risky Strait Between Iran and Arab Nations.” New York Times, May 16, 
2009.  
17 Iran, Oman Ink Agreement of Defensive Cooperation. Tehran Fars News Agency, August 4, 2010.  
18 Ibid.  
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years following a shooting outside it in November 2005. The shooting wounded four, including 
an embassy employee. Oman provided about $3 million to Iraq’s post-Saddam reconstruction, a 
relatively small amount compared to some of the other Gulf states.  
Arab-Israeli Issues 
On the Arab-Israeli dispute, in a stand considered highly supportive of U.S. policy, Oman was the 
one of the few Arab countries not to break relations with Egypt after the signing of the Egyptian-
Israeli peace treaty in 1979. All the GCC states participated in the multilateral peace talks 
established by the 1991 U.S.-sponsored Madrid peace process, but only Oman, Bahrain, and 
Qatar hosted working group sessions of the multilaterals. Oman hosted an April 1994 session of 
the working group on water and, as a result of those talks, a Middle East Desalination Research 
Center was established in Oman. Participants in the Desalination Center include Israel, the 
Palestinian Authority, the United States, Japan, Jordan, the Netherlands, South Korea, and Qatar.  
In September 1994, Oman and the other GCC states renounced the secondary and tertiary Arab 
boycott of Israel. In December 1994, it became the first Gulf state to officially host a visit by an 
Israeli Prime Minister (Yitzhak Rabin), and it hosted then Prime Minister Shimon Peres in April 
1996. In October 1995, Oman exchanged trade offices with Israel, essentially renouncing the 
primary boycott of Israel. However, there was no move to establish diplomatic relations. The 
trade offices closed following the September 2000 Palestinian uprising.  
Oman has expressed an openness to renewing trade ties with Israel if there is progress on Israeli-
Palestinian issues. In an April 2008 meeting in Qatar, Omani Foreign Affairs Minister Yusuf bin 
Alawi bin Abdullah informed then Israeli Foreign Minister Tzipi Livni that the Israeli trade office 
in Oman would remain closed until agreement was reached on a Palestinian state, although the 
meeting itself represented a level of diplomatic outreach by Oman to Israel. There was little 
follow-up thereafter and Oman, like many other Arab states, considers Israeli Prime Minister 
Benjamin Netanyahu opposed to a settlement that would be acceptable to the Palestinians. 
Nevertheless, several Israeli officials reportedly visited Oman in November 2009 to attend the 
annual conference of the Desalination Center, and the Israeli delegation held talks with Omani 
officials on the margins of the conference; this suggests that Oman does not forswear all contact 
with Israel.19 Oman reiterated its offer to resume trade contacts with Israel if Israel agrees to at 
least a temporary halt in Israeli settlement construction in the West Bank. Israel did suspend such 
activity but that suspension was lifted in September 2010; Israel and Oman have not resumed 
trade office exchanges. Oman supports the Palestinian Authority drive for U.N. recognition.  
Although not a major broker among Palestinian factions, Oman attended a January 2009 meeting 
in Qatar called to support Hamas, then at war with Israel in the Gaza strip, which Hamas controls. 
Oman’s attendance, to a certain extent, defied a boycott of the meeting by Saudi Arabia and 
Egypt, which considered the meeting a political boost to Iran, which is among Hamas’ staunchest 
regional supporters. Oman’s attendance could be explained by Oman’s friendly relations with 
Iran, discussed above.  
                                                                  
19 Ravid, Barak. “Top Israeli Diplomat Holds Secret Talks in Oman.” Haaretz, November 25, 2009. 
http://www.haaretz.com/hasen/spages/1130242.html 
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Yemen 
Oman’s relations with neighboring Yemen have traditionally been troubled, but there are signs of 
stability over the past decade. The former People’s Democratic Republic of Yemen (PDRY), 
considered Marxist and pro-Soviet, supported Oman’s Dhofar rebellion in the 1960s and early 
1970s. Oman-PDRY relations were normalized in 1983, but there were occasional border clashes 
between the two later in that decade. Relations improved after 1990, when PDRY merged with 
North Yemen to form the combined modern-day Republic of Yemen. In September 2008, the two 
countries began discussions to form a regional center to combat piracy. In May 2009, Oman 
signaled support for Yemen’s integrity and the government of President Ali Abdullah Saleh by 
withdrawing the Omani citizenship of southern Yemeni politician Ali Salim Al Bidh, who is 
believed to be stoking separatist sentiment in south Yemen.  
Oman has closely watched the popular uprising in Yemen out of concern that violence might 
increase and destabilize the southern Arabian peninsula. According to observers, in 2011, Oman 
built some refugee camps near its border with Yemen to accommodate possible refugees who 
might flee an escalation of violence there. As part of the GCC, Oman has backed the GCC efforts 
to negotiate a peaceful transition from the rule of Ali Abdullah Saleh, who returned to Yemen in 
late September 2011 following recuperation in Saudi Arabia following an attack on him in June 
2011. Saleh agreed in December 2011 to give up power and depart Yemen in line with the GCC 
plan.  
Other GCC and Regional Issues: Bahrain, Libya, and Syria 
Oman, as did the other members of the GCC, fully backed the Al Khalifa regime in Bahrain in its 
confrontation with mostly Shiite opposition protests. Oman supported the GCC consensus to send 
forces from the GCC joint “Peninsula Shield” unit into Bahrain on March 14, 2011, to provide 
backing to the regime’s beleaguered security forces. The GCC Peninsula Shield consisted of 
1,000 Saudi forces and 500 UAE police, as well as Kuwaiti naval units. No Omani forces were 
deployed. The GCC forces were withdrawn in June 2011 after Bahrain lifted the state of 
emergency that was imposed because of the unrest. The GCC countries also decided, in March 
2011, to set up a $20 billion fund to help the two members, Bahrain and Oman, that were facing 
popular unrest, with the funds to be used to create jobs and take other steps to ease protester 
anger.  
Oman did not appear to have played as active a role in supporting the Libya uprising as its fellow 
GCC states Qatar and UAE. According to a wide range of accounts, Oman did not supply 
weapons or advice to rebel forces, as Qatar and UAE did to varying degrees. Oman recognized 
the opposition Transitional National Council as the legitimate government of Libya only after 
Tripoli fell to the rebellion on August 21, 2011.  
Oman is part of the Arab League. It has backed an Arab League plan to try to broker a resolution 
of the unrest in Syria, including the December 2011 deployment of monitors that would facilitate 
a withdrawal of the Syrian military from civilian neighborhoods.  
Border Disputes with Neighbors  
Border disputes and political differences between Oman and the United Arab Emirates (UAE) 
have sometimes flared. The two countries finalized their borders only in 2008, nearly a decade 
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after a tentative border settlement in 1999. In January 2011, Oman arrested several UAE citizens 
that it said were spying on Oman. That came a few months after the UAE arrested about 25 
Omanis on similar accusations. Some observers believe the two may indeed be spying on each 
other because of their differing views on Iran; the UAE is more suspicious of Iran than is Oman.  
Economic and Trade Issues20 
Despite Omani efforts to diversify its economy, oil exports generate about 60% of government 
revenues. Oman has a relatively small 5.5 billion barrels (maximum estimate) of proven oil 
reserves, enough for about 15 years, and some energy development firms say that production at 
some Omani fields is declining.21 In 2009, Oman exported about 400 million barrels of oil (about 
4% of internationally traded oil), of which about 15 million barrels were imported by the United 
States. Still, the relatively high price of oil, coupled with higher output in early 2011, helped 
Oman’s gross domestic product increase by over 15% in the first quarter of 2011. Some 
economists, such as those at HSBC bank, forecast that Oman’s GDP grew about 3.5% for 2011. 
Oman has balked at a Gulf state plan to form a monetary union. 
The United States is Oman’s fourth-largest trading partner, and there was about $1.87 billion in 
bilateral trade in 2010, slightly less than the $2.0 billion in trade for 2009. In terms of specific 
goods, figures from 2009 show that of the approximately $1.125 billion in U.S. exports to Oman 
that year 2009, about 20% consisted of aircraft and related parts, and another 10% consisted of 
drilling and oilfield equipment. Of the approximately $907 million worth of goods imported into 
the United States from Oman in 2009, $765 million consisted of crude oil—nearly 85%.  
Oman is not a member of the Organization of the Petroleum Exporting Countries (OPEC) and is 
therefore not bound by an oil export quota set by that organization. Recognizing that its crude oil 
fields are aging, Oman is trying to privatize its economy, diversify its sources of revenue, and 
develop its liquid natural gas (LNG) sector, for which Oman has identified large markets in Asia 
and elsewhere. Gas ventures with Iran that are under discussion were addressed above, in the 
“Iran” section. In November 2008, Oman signed a 20-year agreement with Occidental Petroleum 
to develop existing gas fields and explore for new ones. Oman is part of the “Dolphin project,” 
under which Qatar is exporting natural gas to UAE and Oman through undersea pipelines; it 
began operations in 2007. The natural gas supplies to Oman from Dolphin free up other Omani 
natural gas supplies for sale to its customers. The need to diversify may have gained further 
urgency in August 2011 when Reliance Energy Ltd. of India abandoned plans to develop an 
offshore oil block six years after signing a production sharing agreement with the government. 
Oman was admitted to the WTO in September 2000. The U.S.-Oman Free Trade Agreement was 
signed on January 19, 2006, and ratified by Congress (P.L. 109-283, signed September 26, 2006). 
According to the U.S. embassy in Muscat, the FTA has led to increased partnerships between 
Omani and U.S. companies. General Cables and Dura-Line Middle East are two successful 
examples of joint ventures between American and Omani firms. Notably, these two new ventures 
                                                                  
20 For more information on Oman’s economy and U.S.-Oman trade, see CRS Report RL33328, U.S.-Oman Free Trade 
Agreement, by Mary Jane Bolle. 
21 Gerth, Jeff and Stephen Labaton. “Oman’s Oil Yield Long in Decline, Shell Data Show.” New York Times, April 8, 
2004. 
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are not focused on hydrocarbons, which serves to show that the U.S.-Omani trade relationship is 
varied and not focused only on oil. 
 
Author Contact Information 
 
Kenneth Katzman 
   
Specialist in Middle Eastern Affairs 
kkatzman@crs.loc.gov, 7-7612 
 
 
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