Arabian Nights

Most people are already aware that Arab world (and possibly beyond, into Persia and China) is being rocked by a series of revolutions.  While there are some superficial differences between what is happened in the various nations (civil war in Libya, for example), the overall theme is similar from one nation to another -- throwing off dictators, in nations with great disparities of wealth, which have generally stayed in power due to foreign support and/or the ability to buy off their security machines through sales of oil.  Interestingly, that combination applies especially to Saudi Arabia. 

In some ways, what we're seeing is a replay of the European Revolutions of 1848, where the spark started in one nation (France) and spread across an entire culture (Europe).  Right now, while these events are still going on, it's really hard to say what is going to be the long term effect on the world.  Certainly, these nations have been ripe for some sort of serious reforms to take place for a long time now. 

However, the problem is that these events are occurring at a time when the world is already unstable and is still trying to find it's way out of the "small" crash of 2008 (small, because most institutions are still functional).  While there have been some signs of recovery, rising oil prices are invariably going to put a brake on that recovery as people and businesses start putting more money toward fuel costs.  Giving that $5 a gallon gas may already be in the works by summer, if not sooner, the ripple effect from the revolutions can't be denied.

There's also the question of how the West can ever hope to establish effective relations with the Arab world on the other side of all this.  Anyone who takes power at this point is going to be replacing Western-backed leaders and will be reluctant to mend fences with the West, or take aid from the West, due to being seen as no different from the people they're replacing.  Part of the post-WW2 strategy for America has been to try to control events and outcomes as much as possible in the Middle East, not much different from the Romans trying to make sure no one in Germania looked South with a gimlet eye. 

In truth, the ability of the West to control these events is probably in question, anyway.  America is dead broke and European is facing its own financial difficulties.  People might be tempted to say that the Chinese will be the real winners here, but they are also having their own issues, including holding a massive amount of U.S. debt of questionable worth.  From the Western perspective, the good news is that the oil still has to flow.  The bad news is that if we see the plunge of the dollar, the oil is going to flow to nations which still have a halfway stable currency. 

It's too soon to tell what the upshot of all this will be, but next few months look to be very "interesting."