No let up in protests in Egypt as Hosni Mubarak tries to pacify protests by firing his cabinet and promising reforms.
Western powers are caught in a vice, trapped between being seen as supporting an undemocratic authoritarian regime but fearful of what could emerge from a collapse of the Mubarak regime. The greatest fear is that Islamists could seize control, which could potentially destabilize the entire region. Egypt controls the Suez Canal, through which 1/3rd of the worlds oil supply transits.
Saudi Arabia, Eqypt’s next-door neighbor, is terrified of the possibility of Egypt falling into the hands of Islamists.
Ironically, Iran, which crushed a similar rebellion 18 months ago, issued a statement of support for the protesters…
If the protests spread to oil producing nations, oil prices are likely to remain well bid as many remember the oil embargo that followed the deposition of the Shah of Iran in 1979…
At this stage, it looks as though there will not be a quick resolution to this crisis and risk aversion will remain the dominant theme when trading resumes Monday…
