Week 7: Aviation Sector of Oman

Hi everyone! Welcome back to my blog. This week, I am discussing the aviation sector of Oman, focusing on the flag carrier; Oman Air. I’ll talk about Oman Air’s history, its current situation, and plans for the future, as well as its connection to Omani foreign policy.

Let’s take a step back in time to the 1940s, when British pilot Freddie Bosworth started an air taxi service from Bahrain to Doha and Dhahran in Qatar and Saudi Arabia respectively. This service later expanded and became the Gulf Aviation Company Limited, registered on March 24, 1950. Gulf Aviation eventually evolved into Gulf Air, one of the oldest carriers in the Middle East. In 1951, British Overseas Airways Corporation (BOAC) became a major shareholder in Gulf Aviation, holding a 22% stake. In 1973, the governments of Bahrain, Qatar, Abu Dhabi, and Oman purchased BOAC’s stake, each acquiring a 25% shareholding in Gulf Aviation, which became a holding company. Gulf Air then became the flag carrier for these four states.

Towards the turn of the 21st century, the states began to leave Gulf Air to fund their own flag carriers. Qatar left in 2002 to start Qatar Airways, and The Emirate of Abu Dhabi left in 2005 to start Etihad Airways. Finally, in 2007, Oman left to focus on Oman Air, leaving Bahrain as the sole owner of Gulf Air, which became its flag carrier.

Now, Oman Air was actually founded about 14 years prior, in 1993. As a small domestic airline, Oman Air flew turboprops (tiny planes) between the capital Muscat and the southern port city of Salalah. Oman Air expanded over the next decade with short routes to India and Africa with leased 737-500s. After 2007 and Oman’s departure from Gulf Air, Oman Air began long haul international routes, beginning with Bangkok and London. Modernization of the fleet continued over the next 5 years, with Oman Air placing orders for Airbus A330s and later Boeing 787s(long range aircraft) along with Embraer 175s (short range aircraft).

The Covid-19 pandemic hit Oman Air hard, cutting short expansion plans and forcing Oman Air to ax unprofitable European routes. These cost saving measures, as well as a complete restructure of their business model has allowed Oman Air to survive the pandemic and hit the ground running as air traffic around the world returns to 2019 levels.

Although Oman Air has done well to recover from the pandemic, a couple problems have remained prevalent since the airline’s founding. Regional carriers such as Emirates and Qatar command a large market share of the Middle East transit market. Oman Air has had to make do with the smaller low capacity routes, while fighting for profit on high traffic routes from the Middle East, namely the European market. Oman Air also has a reputation for suboptimal operational efficiency and customer service. Delays and cancellations have been a recurring issue, leading to dissatisfaction among passengers.

Now how does this connect to Oman’s foreign policy? Well, the development of Oman’s aviation industry has been closely tied to its foreign policy objectives. One of the key drivers of this relationship has been the country’s focus on diversifying its economy away from oil. Aviation has been identified as an important sector that can help Oman achieve this goal by attracting tourists and facilitating trade and investment.

Furthermore, Oman’s geographical location has made it a natural transit hub for flights between Europe, Asia, and Africa, as I mentioned earlier. This positioning has allowed Oman to leverage its aviation sector to strengthen its ties with key international partners, even if Oman Air’s capacity is far lower than their competitors. For example, Oman’s Open Skies Policy has enabled air transport agreements with several countries, including the United States and the European Union, allowing greater connectivity and promoting bilateral trade and tourism.

In conclusion, Oman’s aviation industry has been crucial in shaping the country’s foreign policy objectives, driving economic growth, and strengthening diplomatic ties. As Oman continues to invest in its aviation infrastructure and address challenges facing Oman Air, the industry is set to play a significant role in shaping the country’s future on the world stage.