Iran Tracker

Reaction to 2009 Iranian Presidential Election:

In June, 2009, Sultan Qaboos bin Said bin Taimur sent a letter of congratulations to newly re-elected President Mahmoud Ahmadinejad’s.  Taimur congratulated Ahmadinejad for his victory despite heated public demonstrations against the election results that still disrupted Tehran.[1]

Nuclear:

Oman is an ally of the United States, but also maintains friendly relations with the Islamic Republic, which lies directly across the straight of Hormuz from the small Arab state.  In March 2008, US Vice President Richard Cheney visited Oman to discuss cooperation over Iran’s nuclear program.[2]  In December 2008, Omani Foreign Minister Yousuf Bin Alawi said that Iran’s nuclear enrichment is “no cause for concern.”[3]  In April 2009, US Special Adviser for the Persian Gulf and Southwest Asia Dennis Ross visited Egypt, Saudi Arabia, the United Arab Emirates, Oman, Bahrain and Qatar to discuss diplomatic efforts to engage Iran on its nuclear program.[4]

Economic Relationship:

Iran and Oman are both members of the Organization of Petroleum Exporting Countries. In the energy sector, Oman and Iran have cooperated in oil refinement and gas transportation. In September 2008, the two began discussing a deal that would allow Iran to use Omani facilities to process its crude natural gas into liquefied natural gas (LNG) for transportation to consumer countries around the world. [5] The two also share a gas reserve off Oman’s Musandum Peninsula and have finalized an agreement to develop Iran’s Kish Island gas reserves together. [6] The Kish Island agreement provides that Oman and Iran will invest in a four-year project that will cost about $12 million.[7] 

In February 2009, Oman hosted an Iranian trade exhibition, demonstrating the two countries growing economic ties.  According to Iranian ambassador to Oman Murtadha Rahimi, “the trade exchanges between the two countries as well as the mutual visits by the businessmen from the two countries increased during the last two years.”[8] In May 2009, Iran and Oman opened their first joint company for foreign investment. Managing Director of Iran's Foreign Investments Company Mehdi Razavi noted that "[f]ormation of this company facilitates implementation of Iran's needed projects by the Omani private sector and also the Iranian private sector can use the facilities of the company to perform different projects in Oman.”[9]

During a visit by a high ranking Omani delegation in August 2009, Iran and Oman inked a memorandum of understanding agreeing to construct a petrochemical unit in Iran’s South Pars region, a project totaling roughly $800 million. According to Iranian Oil Minister Ghlam-Hossein Nozari, the Omani delegation requested “some 2 billion cubic feet of natural gas from Iran to feed its LNG production units."[10]

In August 2009, Iran and Oman reopened negotiations on exporting Iran’s gas to Oman.  Building on the deal signed by Iran and Oman in April 2009 which did not specify a timeline for the $7-$12 billion project, the countries renegotiated the amount of Oman’s investment in the development of the 124 mile underwater pipeline which would transport gas to Oman at a rate of one billion cubic feet per day.[11]

In November 2009, Iranian Oil Minister Masoud Mirkezemi and Omani Oil Minister Mohammed Al-Ramahi met in Tehran to discuss bilateral investments in the gas sector and joint development of the Kish and Hengam gas fields in the Persian Gulf.[12]

Iran expects to launch its second trade center in overseas markets by February 2010, says Hamid Zadboum, an official with the Trade Promotion Organization of Iran. He went on to say that the center would become operational in Oman and that some 60 Iranian companies are expected to operate from the proposed Oman center. The Iranian government has allocated one billion dollars in loans to set up 20 trade centers across the world.[13]

Iranian Ambassador to Oman Hossein Noushabadi stated that Iran and Oman will establish a joint bank in an effort to increase financial transactions between the two countries. Noushabadi said that opening a joint bank between Iran and Oman is necessary to strengthen financial bonds and will serve as a guarantee for future joint ventures. In addition, he added that increased financial ties through a joint Oman-Iran bank would benefit the existing branches of banks Melli and Saderat in Oman.[14]

[Click here for more information about Oman’s business activity with Iran.]

Diplomatic/Military Relationship:

According to Manouchehr Takin of the Centre for Global Energy Studies in London, “of all the Persian Gulf Cooperation Council (PGCC) countries, Oman had historically been closest to the region's neighbor to the north.” [15] In 2006, the two countries agreed to cooperate in their national healthcare programs, and in August 2008, Iran and Oman discussed developing joint military programs. [16] These were addressed in a meeting of the Iran-Oman joint military committee and would involve joint training and military exercises. [17]

In January 2009, Omani Foreign Minister Yahya bin Abdullah Al Feneh al-Arimi described Iran as a “great and powerful neighbor” and called for the two to expand bilateral ties in regional issues.[18] In May 2009, Iran and Oman began drafting a security agreement, with Omani Crown Prince Malik Bin Suleiman Al Moammari saying that "the Omani government and nation are willing to further expand ties with the Islamic Republic of Iran in all fields."[19] In what Omani Ambassador to Iran Sheikh Yahiya al-Oraimi hailed as “a milestone and a jump towards prosperity in Iran-Oman relations in all the political, economic and cultural fields,” Sultan Qaboos bin Saeed visited Iran in August 2009.[20] During the visit – which had been delayed due to the June and July political unrest in Iran – the two countries signed a security pact. The Omani sultan stated during the visit that “[t]he Persian Gulf littoral states must consider the region's common interests and with stepped up cooperation prepare the grounds for its lasting security.” Iranian Supreme Leader Ayatollah Khamenehi added that “[t]he US and some meddlesome states by continuously injecting insecurity and suspicion have never allowed the sensitive Persian Gulf region to witness calm."[21] Iran and Oman also agreed on seven memoranda of understanding on several different issues, including political, economic and cultural cooperation.[22] The two countries share control of the strategic Strait of Hormuz.  In November 2009, Omani Minister of State for Foreign Affairs Youssef bin Alawi Abdullah announced his country’s strong diplomatic ties with Iran saying “the relations between Iran and Oman are strategic and Oman will not be affected by any country in its policies towards Iran.”[23]  He added that Oman “moves on the basis of joint cooperation, stability and regional security which form the tenets of the country’s foreign policy” with Iran.[24]

In a meeting with Iranian Foreign Minister Manouchehr Mottaki on January 13, Omani Foreign Minster Bin Alawi pointed out to Iran's geographical position as a bridge between Persian Gulf and Central Asia, and said his country is willing to expand cooperation with Iran on economic, industry, development, and trade.[25] Manouchehr Mottaki called for greater momentum in completing joint economic ventures between the two countries. Mottaki said Iran's potential to expand its roads, railways, and ports could create a great capacity for bilateral economic projects. [26] President Ahmadinejad responded by saying that the two countries enjoy bilateral relations based on their common views on different regional and international issue, and added that "the Islamic Republic of Iran is ready to boost its relations and cooperation with Oman in all fields."[27] Furthermore, both Ahmadinejad and Bin Alawi suggested that Yemen should turn to dialogue to end a conflict with Shi'ite rebels that has complicated efforts to combat al Qaeda in the troubled Arabian Peninsula country.[28]

[Click here for more information on the Gulf Cooperation Council]