The attack left at least nine people dead, including three attackers, a rare security breach in the oil-producing Persian Gulf state.
Four Pakistanis, an Indian and a police officer were among those killed in the gun attack, according to Pakistani, Indian and Omani officials. The Oman police said 28 people of various nationalities were wounded, including security personnel.
The attack began on Monday evening at the Ali bin Abi Talib (AS) mosque in the Wadi al-Kabir neighborhood of Oman's capital Muscat, authorities said, 500 meters from an international school and an adjacent skateboard park and less than 10 kilometers from a string of five-star beach resorts.
Such violence is exceptional in Oman-- ordinarily secure and stable -- raising fears that Daesh, which has operated in the shadows since 2017, may be attempting a comeback in new territory.
Daesh said in a statement late on Tuesday that three of its "suicide attackers" fired on worshippers at the mosque on Monday evening and exchanged gunfire with Omani security forces until morning.
The group also published what it said was a video of the attack on its Telegram site.
Another video shared on social media and verified by Reuters showed people running from the mosque while gunfire could be heard.
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Police have not said whether they have identified a motive for the attack or made any arrests. Omani authorities also have not released the identity of the attackers.
A local source said the mosque was also known as Imam Ali (AS) mosque and is a Shia place of worship in Ibadi-ruled Oman, which has a small but influential Shia minority.
Describing the incident as a "terrorist" attack, the Pakistani foreign ministry said 30 survivors were being treated in hospitals.
Daesh said its fighters attacked a gathering of Shia Muslims who were "practicing their annual rituals."
Monday evening marked Ashura, on which Shia Muslims and others mourn the martyrdom anniversary of Imam Hussein (AS) and his companions in the 680 AD Battle of Karbala.
"This is a very unprecedented event ... the likes of it we have not seen in Oman's history," Pakistan's ambassador to Muscat, Imran Ali, said after visiting some victims in hospital.
He said most of the 30 victims there were being treated for gunshot wounds while others had suffered injuries fleeing the attack, including being crushed in a stampede.
In March, the Daesh terrorist group said it was behind an attack that killed more than 140 people at a concert hall near Moscow, and in January it claimed responsibility for two explosions in Iran that killed nearly 100.
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Such high profile attacks have stoked fears of a comeback for a group with clandestine leadership and whose fighters are thought to be scattered in autonomous cells.
At its height of its power in the early-2010s, Daesh declared a "caliphate" over a wide area of Syria and Iraq, imposing death and torture on detractors, and inspiring attacks in dozens of cities around the world.
Source: Reuters