The last emirate to produce Arabian Nights stamps is Fujeira. Fujeira is also part of the United Arab Emirates (UAE). It joined in late 1971 and was the last of the seven emirates to join. Politically, Fujeira is an absolute monarchy, like all of the emirates, within the federation that is the UAE. The stamps below are, I believe, from 1967. The subject matter of many of the stamps is too vague for me to identify which stories they are associated with.
Three of the seven emirates issued Arabian Nights theme stamps in 1967. This was prior to the formation of the UAE. I have not seen Nights stamps from the other emirates but I wonder if they also issued some. Additionally, I can’t find any reason as to why the three emirates issued their Arabian Nights stamps in 1967.