A joint statement by Netanyahu and Oman's ruler Sultan Qaboos said the two sides "discussed ways to advance" the so-called Middle East peace process and "a number of issues of mutual interest to achieve peace and stability in the Middle East".
Yemen's Houthi Ansarullah movement has criticized the Sultanate of Oman for welcoming Israeli Prime Minister Benjamin Netanyahu's unannounced visit to the Persian Gulf Arab country.
Netanyahu and his wife, Sara, were joined by Mossad intelligence chief Yossi Cohen, who has reportedly been responsible for clandestine talks with Gulf governments, and National Security Adviser Meir Ben-Shabbat. Days before Netanyahu's visit, Palestinian President Mahmoud Abbas also visited Oman, raising the possibility that Oman might be trying to help revive negotiations or push forward a troubled USA peace plan.
Oman has a history of helping to mediate Middle Eastern conflicts, though it has never had consistent diplomatic relations with Israel.
The visit came at the invitation of Sultan Qaboos and followed "lengthy contacts between the two countries", the Israeli statement said.
He added that Oman is "very optimistic" about US President Donald Trump's peace plan saying the "solution will be beneficial for Israelis and Palestinians alike".
Although Israel and Oman do not have diplomatic relations, the two countries agreed in 1996 to open commercial representation offices.
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A Wikileaks cable from 2010 reported that Gulf states believed they could "count on Israel against Iran".
The Palestinians cut ties with the U.S. after the White House recognized Jerusalem as Israel's capital and then moved the American embassy there in May. Unlike many Arab states, Oman has also maintained relations with Syria.
Netanyahu has on several occasions hinted at warmer ties with Gulf states.
The following month, Omani officials joined their Arab counterparts from the United Arab Emirates, Saudi Arabia, Qatar and Bahrain at the White House for a meeting with Israeli national security officials to discuss the dire humanitarian situation in the Gaza Strip.
A trade office in Oman was closed in 2000 during the second Palestinian Intifada.
Sports Minister Miri Regev arrived on Friday for the event's opening ceremony in Abu Dhabi, marking the first time an Israeli minister has visited the UAE in an official capacity.
In another sign of warming ties between Israel and Arab states, Israel's judo team is set for the first time to participate at an worldwide competition in the UAE under their national flag.