Oman Poised to Lead Global Green Steel Revolution: IEEFA Report

Oman is emerging as a potential global leader in the green iron and steel industry, leveraging its strong industrial foundation, strategic geographic position, and renewable energy potential, according to a new report by the Institute for Energy Economics and Financial Analysis (IEEFA).

The report, titled “Oman at the Frontline of the Green Steel Transition,” authored by Soroush Basirat, Energy Finance Analyst for Global Steel at IEEFA, highlights the country’s readiness to capitalise on the global decarbonisation of iron and steelmaking.

“Oman is one of the few nations in the Middle East and North Africa (MENA) region with an integrated steelmaking supply chain,” Basirat said. “This established industrial base provides a solid foundation for transitioning towards low-emission and ultimately green steel production.”

Integrated Industrial Strength

Oman’s steel industry encompasses iron ore concentration, pelletising, direct reduction, and electric arc furnace (EAF) operations. The nation’s strong presence in producing iron metallics—particularly direct reduced iron (DRI)—positions it well for the shift toward low-emission manufacturing.

However, the report cautions that gas-based DRI production remains emissions-intensive. “It is not possible to produce green iron and steel with gas. Transitioning to green hydrogen is essential if Oman wants to capture the green premium in global markets,” Basirat noted.

Renewable Energy Backbone

Oman’s vast solar and wind potential could play a decisive role in powering its green steel transformation. Reliable and affordable renewable energy will be key to supporting DRI plants, EAFs, and electrolysers required for hydrogen production.

The country’s national hydrogen strategy aims to produce between 1 to 1.5 million tonnes of green hydrogen annually by 2030. The steel sector is expected to become one of the primary offtakers in Oman’s emerging green hydrogen economy.

Strategic and Policy Advantages

Oman’s Vision 2040 development plan targets a non-oil GDP share exceeding 90%, reflecting its ambition to diversify away from fossil fuels. The government’s hydrogen roadmap includes infrastructure development, financial incentives, and initiatives to secure international offtake agreements.

With vast land availability and strategic maritime access, Oman is ideally positioned to serve major export markets in the EU and Asia, including Southeast Asia.

Rising Investment and New Entrants

While Jindal Group and Vale have traditionally dominated Oman’s steel sector, the market is now attracting significant new players such as Meranti Green Steel, Mitsui, Kobe Steel, and ACME Group. These companies are investing in next-generation DRI facilities designed for flexible use of both gas and hydrogen, with plans to gradually scale hydrogen usage.

A Defining Moment for Oman

“Oman stands at a pivotal moment,” Basirat emphasised. “With its ability to supply cost-competitive green iron to global markets, the country holds a substantial advantage. Its structured approach to managing this industrial transition places it at the forefront of the global green steel revolution.”