Egypt and Iran are expected to exchange ambassadors within months, part of a process mediated by Oman to normalise relations between the two regional powers, Egyptian officials told The National.
Two officials said that a meeting has been agreed in principle between President Abdel Fattah El Sisi of Egypt and his Iranian counterpart, Ebrahim Raisi.
They said the meeting is likely to take place by the end of the year.
The news comes days after Oman's ruler, Sultan Haitham bin Tarik, paid a two-day visit to Egypt where he and Mr El Sisi discussed Cairo's relations with Tehran, according to the officials.
Oman enjoys close relations with Muslim, non-Arab Iran and has frequently assumed mediating roles in regional conflicts or in disputes pitting Tehran's clergy-led regime against other governments, in the Arab world and in the West.
Iran, for its part, said it wanted better relations with Egypt, the most populous Arab nation. The Egyptian government, however, has been silent on relations with Iran, but regional media has been reporting an impending thaw in relations in recent weeks.
Normalised relations with Iran, the officials said, ensures Tehran's goodwill in relation to Cairo's efforts to forge closer economic and commercial ties with countries such as Iraq, Syria and Lebanon, where it wields significant influence.
Egypt will also seek to persuade Iran to drop or at least curtail its support for Hamas and Islamic Jihad, the two main militant Palestinian groups in the Gaza Strip, which borders Egypt, according to the officials.
Frequent outbursts of hostilities between the two militant groups and Israel presents a security threat to Egypt and also impedes its efforts at reconciliation between the pair and the Palestinian Authority in the West Bank, a goal that could be the prelude to the resumption of long-stalled Palestinian-Israeli negotiations.
Mid-level diplomats and intelligence officials from Iran and Egypt have been holding behind-closed-door consultations on normalising relations since March. The last round of these talks was held earlier this month in Baghdad, whose government has close ties with Tehran.
Besides bilateral relations, the talks touched on reducing tension in places where Iran wields significant influence, such as Yemen, Lebanon and Syria, by supporting allied Shiite governments or armed groups.
A thaw in relations between Cairo and Tehran would add a new layer to an ongoing regional realignment that is changing the area's political landscape.
Saudi Arabia, for example, has agreed to restore diplomatic relations with Iran that were severed in 2016, thus removing a major source of tension in the Middle East. Egypt and Turkey, at odds for a decade, have also been working to normalise relations.
The eight-year war in Yemen, where Iran has backed the Houthis against the internationally recognised government, supported by a Saudi-led military coalition, has significantly quietened amid diplomatic moves to end the conflict.
Syria, where Iran and the Tehran-backed Lebanese group Hezbollah have significant influence, was readmitted to the Arab League this month. Its one-time pariah president, Bashar Al Assad, attended last week's Arab summit in Jeddah, Saudi Arabia, for the first time in 12 years.
Syria's membership in the Cairo-based Arab League was suspended more than a decade ago after its crackdown on anti-government protests. The readmission of Syria into the Arab fold was warmly welcomed by Iran.
Tehran's relations with Cairo, a close ally of the US, Saudi Arabia and other Gulf countries, have been fraught since the ousting of Iran's Mohammad Reza Pahlavi in the 1979 Islamic revolution.
Pahlavi died in Egypt in 1980, where he is buried with other members of his family, which created tension between Cairo and Tehran.
Relations further deteriorated when Iran's government named a Tehran street after Khaled Al Islambouli, an Egyptian army officer who led a team of assassins that killed Anwar Sadat during a 1981 military parade in Cairo.
Repeated requests by Cairo to remove his name were denied.
More recently, relations have been tense over what Cairo sees as the meddling of Iran in the internal affairs of Arab nations such as Iraq, Syria, Lebanon and Yemen.
In a thinly veiled reference to Iran, Mr El Sisi's government has repeatedly declared Egypt's willingness to come to the aid of its Gulf Arab allies and benefactors if they faced an external threat.
Unlike Saudi Arabia, which closed its embassy in Tehran in 2016, Egypt has maintained diplomatic representation in Iran since the Islamic revolution. However, it has only a charge d'affaires running its mission in Tehran.
Iran on the other hand has a functioning embassy in Cairo.