• Western allies, including the United States, are setting about planning for the oil market shock that would occur if they decide to place an embargo on Iranian oil—which, given the importance of the Strait of Hormuz, could affect as much as one-fifth of world supply. [WSJ]

• The Egyptian Salafi party—which is even more radical than the Muslim Brotherhood and has received strong support in elections—vowed to respect the Israeli-Egptian peace treaty. [Haaretz]

• The rabidly anti-Israel Secretary of Defense Leon Panetta warned that Iran could develop a nuclear weapon in less than a year and pledged the United States “will take whatever steps [are] necessary to stop it.” [Ynet]

• Syria will reluctantly allow Arab League observers in to see that the regional peace deal is being carried out. [LAT]

• A new book is getting attention for rigorously arguing that a major obstacle to Mideast peace is the wide discrepancy between what Palestinian leaders tell their own people and what they sugarcoat and soften up for world consumption. [NYT]

• The Egyptian economy looks to be in poor shape, which isn’t great when you are trying to tamp down unrest. [WP]