UK invests $5bn in Oman in 12 months

Eduard Galitsky/Unsplash

• UK is largest foreign investor
• Accounts for 50% of FDI
• Plans to expand beyond oil

The United Kingdom pumped more than $5 billion in foreign direct investment (FDI) into Oman in the 12 months from October 2023, maintaining its position as the biggest external investor in the country, official data shows.

The UK’s cumulative stock of FDI in Oman was 13.7 billion Omani rials ($35.6 billion) by the end of the third quarter of 2024, figures released by the official Oman news agency (ONA) at the weekend showed.

At the end of the third quarter of 2023, the stock stood at OMR11.5 billion, the ONA said, citing a report by the National Statistics and Information Centre (NSIC).

This means UK investors channelled $5.6 billion into Oman during the year ending September 2024, equal to almost $470 million a month.

Britain and Oman maintain strong economic, political and military links, and the sultanate is one of the largest Middle East trading partners of the UK. Shell, listed in London, is the main partner in Petroleum Development Oman, while BP operates the massive Khazzan tight gas project.

Oman is also home to a UK military training ground and hosts a naval logistics and ship repair base at Duqm, a port in the south.

The UK has remained the largest foreign investor in Oman in recent years. Investment from the UK accounted for just over half of the total cumulative FDI in Oman at the end of September last year, the report said.

Official British data showed UK exports to Oman stood at about £1.2 billion ($1.46 billion) in the four quarters to the end of Q2 2024, an increase of nearly 11 percent over the same period of the previous year.

Oman foreign direct investment

UK imports from Oman, a non-Opec oil and gas producer, amounted to nearly £400 million, up by more than a third in the same period.

Most of Britain’s assets in Oman are concentrated in the oil and gas sector, but the British government has promised to expand the scope beyond hydrocarbons.

Douglas Alexander, the British minister of state for trade policy and economic security, said during a visit to Muscat last year that nearly 96 percent of UK investments in Oman were associated with oil and gas.

“However, all the ministers and leading British business figures I have met today are committed to moving beyond a familiar transactional relationship to a more relational, win-win approach,” Alexander said.

In its report, the NSIC said the US was the second largest foreign investor in Oman, with a total FDI of OMR5.25 billion. It was followed by the UAE, which has invested nearly OMR836 million, the report said.

The report showed the hydrocarbon sector has the lion’s share of investments in Oman, with a total FDI of OMR21.1 billion, accounting for four fifths of the cumulative FDI in the sultanate.