Qaboos, who died on Friday at the age of 79 as the longest-serving leader of the modern Arab world, came to power in 1970 when he deposed his father in a palace coup.
He had been ill for some time and was believed to be suffering from colon cancer.
Qaboos had left no apparent heir. He was unmarried, had no children or brothers and his successor was to be chosen in a meeting of the royal family.
Under the Omani constitution, they had three days to make a decision and if they failed to agree, the person chosen by the late sultan in a sealed letter would succeed him.
State TV said during a live broadcast of the funeral that the letter had been opened, without elaborating as to why.
"Haitham bin Tariq was sworn in as the new sultan of the country... after a meeting of the family which decided to appoint the one who was chosen by the sultan," the government said in a tweet.
Many experts had expected the throne to go to Asad bin Tariq, another cousin, who was appointed deputy prime minister for international relations and cooperation affairs in 2017 in what was seen as a clear message of support.
Haitham, a sports enthusiast, held the position of undersecretary of the ministry of foreign affairs for political affairs before becoming the minister of heritage and culture in the mid-1990s.
He was also the first head of Oman's football federation in the early 1980s.
'Switzerland' of Mideast
Sultan Qaboos was to be laid to rest on Saturday in ceremonies that saw his coffin, draped in the Omani flag, driven through the streets of the capital Muscat before being taken to the main mosque, which is named after him.
The royal court announced a mourning period that will see businesses and government offices close for three days.
Qaboos transformed the Arabian Peninsula nation from a backwater into a modern state with a thriving tourism industry, thanks to the country's crystal waters, scenic desert and mountain ranges.
But it was the sultan's policy of neutrality and non-interference that elevated Oman's standing as a "Switzerland of the Middle East" and made him an important mediator.
Many Western and Arab diplomats see the sultanate, with its moderate but active foreign policy that includes healthy relations with the United States as well as with regional powers Iran and Saudi Arabia, as a model of balance.
As the Gulf's discreet go-between, Oman played a role in Iran's 2015 nuclear deal with world powers while preserving its membership in the Saudi-led Gulf Cooperation Council (GCC).
"He was a stable force in the Middle East and a strong US ally. His Majesty had a vision for a modern, prosperous, and peaceful Oman, and he willed that vision into reality," former US president George W. Bush said in a message of condolence.
Abu Dhabi Crown Prince Mohammed bin Zayed Al-Nahyan said Saturday that Oman and the Arab world have lost a "wise leader and a (figure) of great historical stature".
The sultan's death comes amid increased tensions between Tehran and Washington, who on Friday piled new sanctions on the Islamic republic following the killing of a top Iranian commander in Iraq that raised fears the region was sliding into war.
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It's almost impossible to imagine Oman without Sultan Qaboos at the helm - Kristian Ulrichsen, fellow at Rice University's Baker Institute in the US |
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Discreet mediator
During the sultan's reign, Western nations repeatedly turned to Muscat to act as a mediator in resolving thorny regional issues - from the kidnapping of Americans and Europeans to the 2015 Iran nuclear deal.
Although it is a member of the GCC, Oman is the only Gulf country not to have taken part in the Saudi-led military coalition's fight against Yemen's Iran-backed Huthi rebels.
Unlike other Arab states, Qaboos did not contest Egypt's 1979 peace treaty with Israel, opening a trade office in Tel Aviv in the mid-1990s - shuttered in 2000 during a Palestinian uprising.
In October 2018, Israeli Prime Minister Benjamin Netanyahu held surprise talks with Qaboos in Muscat.
It remains to be seen whether the next Omani ruler will take the same moderate approach in a region often in turmoil.
"It's almost impossible to imagine Oman without Sultan Qaboos at the helm," said Kristian Ulrichsen, a fellow at Rice University's Baker Institute in the US.
"His wise leadership and regional statesmanship is never more urgently needed than at the present time," Ulrichsen said on Twitter.
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