Oman, the ‘Switzerland of the Middle East’, is about to find itself in troubled waters over its refusal to take sides

The country’s position as mediator has been pushed to the limits with a crisis unfurling in its backyard: the strategic Strait of Hormuz

Even though the Sultan himself has repeatedly dismissed the comparison, Oman continues to enjoy the moniker of being “the Switzerland of the region”.

In an area gripped by brutal conflict, Oman has appeared almost magician-like in its ability to avoid being dragged into the vortex.

But as regional wars spawn region-wide wars, avoiding the complex web of alliances has become increasingly tricky for the ailing Sultan Qaboos bin Said al Said, a confirmed bachelor who rose to power in a 1970 bloodless coup against his father and who holds the reins of power close to his chest.

Analysts in Muscat say his determination to maintain a neutral position and be friends with everyone, in particular, Iran, is irritating key neighbours.

Meanwhile, there are rising murmurs of discontent from within the population who see no benefits from Oman’s seemingly exhaustive efforts of shuttle diplomacy. Particularly as the authorities rarely open up to media about what they are doing.

In 2011, Oman faced its own Arab Spring demonstrations against rising unemployment and the high level of expatriate workers. The Sultan swiftly reacted but many fear those troubles could bubble up again.

“In short we don’t see any returns,” Dr Abdullah al-Ghailani, an Omani strategist told me in Muscat.

He said foreign investment in Oman is still comparatively small (although the British are among the largest investors) and there was still a big problem with unemployment.

“Oman will always keep silent – but I don’t see this as a strength this a sign of weakness, our foreign policy has to be reshaped to serve our own interests.” he said.

So is the Switzerland of the Middle East in troubled waters?

At the heart of Oman’s unique position in the region is that for many years, Muscat has been one of the main, if not only, conduit to Iran for the west.

From top discussions with Iran’s leaders over how to secure the release of a British tanker in the Strait of Hormuz to gritty negotiations to free hostages taken by Tehran’s alleged proxies, the Houthis in Yemen, Oman has popped up as a unique player able to bridge the yawning gap between rivals in the region.

With comparatively few natural resources like oil and gas (at least if you look at its wealthy neighbours the UAE and Saudi Arabia), historically, the Sultan’s position has been to gain leverage as trusted peace broker, utilising Oman’s unique relationship with Iran.

Perhaps the reason is because the country is majority Ibadi Muslim, and so not beleaguered by the challenges of the tricky Sunni-Shia divide that has underscored so many nearby fights.

This has allowed it to open its doors to both Sunni-majority Gulf states and Iran, which it has done ever since the Gulf Cooperation Council was established in the early 1980s.

Omanis will proudly say everyone is welcome, it’s one of the few countries in the Gulf where people openly talk of holidaying in Iran.

The Sultan last autumn hosted Israeli prime minister Benjamin Netanyahu, much to the surprise, and in some quarters anger, of people in the Palestinian territories and the Gulf.

But in June, Oman also became the first Gulf state to open an embassy in Ramallah, the West Bank, an announcement which coincided with the US’s controversial economic peace conference in Bahrain, which was attended by finance ministers of Saudi Arabia, Bahrain and the UAE but the Palestinians boycotted it on the grounds it was too pro-Israel. Oman notably did not participate.

Every Omani analyst I spoke to, including one who holds a prominent government position, told me without Oman “there would be chaos in the region”.

But many also warned this refusal to take sides has sparked some anger from its regional and international partners and could backfire.

Oman’s position as mediator, or facilitator, as many within Muscat prefer to call it, has been pushed to the limits with a crisis unfurling in its backyard: the strategic Strait of Hormuz, which carries 20 per cent of the world’s oil supplies.

British-flagged Stena Impero was seized by Iranian forces in Omani waters, a colossal breach of its sovereignty.

Yet Oman, although apparently begged by the Brits to speak out, refused to comment on where the capture took place and crucially to condemn it in strong terms.

The Iranians claim the tanker was legally detained because it violated “international maritime rules”.

But more crucially, this has annoyed some Omanis who felt walked over.

“Iran is taking full control of the strait, but Oman isn’t talking about it at all,” Dr al-Ghailani added.

“I’m not saying we have to be tough on Iran, but we legally have the right to express the tanker was seized in our waters,” he said.

Tensions have also bubbled over in Yemen where Oman is the only GCC member to refuse to participate in Riyadh’s coalition fighting against the Houthis. Oman is host to a myriad of different actors within Yemen, from the Houthis themselves to disgruntled anti-Houthi Yemeni southerners.

Figures close to the leadership told me that there will be a meeting in the coming days in Oman between key figures in the conflict.

“It’s a dangerous position to be in. We upset a lot of people,” said Ahmed Ali M al-Mukhaini, an independent political researcher and former assistant secretary-general for the Shura Council in Oman.

“If it wasn’t for Oman, there would be more chaos in the region... but we are concerned the situation in areas like Hormuz would force Oman to take sides.”