Bahrain Mirror- AFP: Oman on Tuesday denied it has agreed to establish diplomatic relations with Israel, a day after the Israeli intelligence chief said his country was renewing ties.

Reports on the "establishment of diplomatic relations between the sultanate and Israel are baseless", the foreign ministry said on Twitter.

"The sultanate is keen to create diplomatic conditions to restore communication between all international and regional parties to work on achieving peace between the Palestinian Authority and Israel, resulting in an independent Palestinian state," it said.

On Monday, the head of Israel's Mossad intelligence agency, Yossi Cohen, said his country was establishing "formal relations" with Oman.

"Just recently, renewal of formal relations with Oman was declared and the establishment of a representative office of the (Israeli) foreign ministry in that country," he told a security conference in Herzliya, near Tel Aviv.

Oman's statement on Tuesday made no mention of an Israeli representative office.

Israel and Oman agreed to open trade representative offices in the 1990s, but in 2000 the Gulf sultanate closed them after the outbreak of the second Palestinian intifada.

In October, Israeli Prime Minister Benjamin Netanyahu held surprise talks with Oman's Sultan Qaboos in Muscat.

The move raised Palestinian fears of a normalisation of ties.

Last week, Oman said it would open an embassy in the Palestinian territories, in a first for a Gulf Arab state.

Arabic Version