Oman is a country in southwest Asia on the coast of the Arabian Sea, Gulf of Oman, and the Persian Gulf. Neighboring countries include Saudi Arabia, United Arab Emirates and Yemen. Oman has a strategic location on the Arabian Peninsula adjacent to the Strait of Hormuz, a vital transit point for world crude oil. The geography of Oman is mountainous and arid. The government system is a monarchy. The chief of state and head of government is the Sultan and Prime Minister. Oman has a mixed economic system in which the economy has a combination of free market activity and government intervention.