About 300 people demanded political reforms and better pay in a peaceful protest in Oman on Friday as unrest in other Middle East countries and North Africa turned increasingly violent.

Men and women gathered in Ruwi, a commercial district in the capital, after prayers and chanted "we want democracy" while others shouted "more pay and jobs".

"Food prices and other commodities have gone up twice in price in the last three years the increase is not enough," student Mohammed Hashil told Reuters.

Protesters demonstrated for about one hour and left the district. There were no reported arrests.

The sultanate increased the salary for national workers active in the private sector to RO200 ($520) per month from RO140, the Oman News Agency (ONA) said this week.

There is no official unemployment rate, but a CIA estimate from 2004 put the rate then at about 15 per cent.

Gulf countries have stepped up measures to appease their populations following popular unrest that toppled the leaders of Tunisia and Egypt. Protesters in Muscat also demanded cabinet ministers not serve more than four years.

 "The cabinet must be appointed from the Shura Council because the members are elected. We can't have ministers serving 10 to 20 years. It is encouraging corruption," said one protester, who did not want to be identified.

In 1992, Sultan Qaboos bin Said established a parliament called Majlis Shura, whose 84 members are elected by constituents in 61 districts. But the parliament only advises and has no legislative powers.

Omani participation in the private sector is estimated at 19 per cent, but more than a million Omanis are not registered as private-sector and are self-employed in retail, agricultural and cottage industries where they have unlicensed businesses in crafts such as pottery, weaving, and silvercraft.

Inflation in the non-Opec oil producer accelerated to 4.2 per cent year-on-year in December and prices rose 0.7 per cent from the previous month as food costs soared, data showed.-Reuters