Oman: The 'Real' Middle East

Potentially the largest advantage Oman can offer is its location. While still a Gulf nation, it sits outside the Strait of Hormuz, not only reducing some shipping uncertainty given the instability in the Gulf region but also putting Omani ports closer to main shipping lanes.

Because of its relative lack of development, it is many times overshadowed by ports such as Dubai. However, the Omani people are working hard to develop a reputation as a stable and less frenzied alternative to the U.A.E. and Qatar, and it seems to be working.

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This very interesting bit of data came from our meetings in Oman: Nearly 55% of the Omani populace is under 21 years of age. With the birth rate continuing to increase in Oman -- and in many other GCC nations -- the challenges for the educational infrastructure are clear.

However, the workforce implications are even more important. At the same time that Western workforce pools area graying, Middle Eastern and Asian pools are becoming larger and more eager. We met with a group of more than 30 young business leaders in Dubai on Tuesday night. The average age of the group was under 30, and all were developing and leading business initiatives in Dubai and in other major cities of the Middle East.

The common theme among them all was a sense of spirit, determination and interest in creating leading, international businesses. On Monday, I wrote about why the Gulf countries could well be on their way to creating the next global financial center. A young, eager and educated (certainly a key that isn't necessarily apparent in all Gulf countries) leadership will go a long way to pushing toward that goal.

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As the need for additional hydrocarbons continues to grow and the depletion rate of existing fields accelerated, the need to find new hydrocarbon reservoirs will increase. And once they are found, there will be a growing need to move that oil from field to market. That movement will be facilitated by an rapid increase in pipeline development in the region.

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At time of publication, Edmonds had no positions in stocks mentioned, although holdings can change at any time.

Christopher Edmonds is managing principal at Energy Research & Capital Partners, an energy investment firm and an affiliate of FIG Partners. He is based in Atlanta. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. While Edmonds cannot provide investment advice or recommendations, he appreciates your feedback; click here to send him an email.