We don't know where the current revolts in the Arab world will lead but some conclusions can already be drawn:
1. There is no going back to dictatorships, even though the road ahead will be difficult and long;
2. Current Arab rulers are wary of the public sentiment against Israel, so they will be inclined, not only to stop cosying up to Israel and the West but also to be belligerent against Israel, hoping to gain some favor from their people;
3. Even the US seems wary right now (despite its unflinching support for Israeli settlements). My guess is the US will be carefully watching events in the Arab world as they unfold and try to curry the favors of the new rulers who will emerge from the revolts, and as they will be changing more quickly than before and unstable regimes will be in place, the US will be less certain of its influence in the Arab world and will be less willing to go along Israel's adventurous politics like waging wars in the name of regime change in the Middle East. However, this does not mean that the US will change its attitude toward the illegal Israeli settlements. This matter may even get worse in the near future as israel tries to grab as much land as possible... The US is also trying to influence what is happening now in the Arab world but my bet is that this influence will not find an auspicious reception given the amount of mistrust between the Arab public and the US;
4. This will reinforce on one side Israel's feeling of insecurity and isolation, and Israel's stubbornness on settlements on the other side stemming from a false sense that facts on the ground and US veto are all what it takes to continue building settlements and de facto blocking peace. This sentiment of false insecurity on the foreign policy side and false security on the internal policy side will push Israel to become more belligerent, therefore realizing Nasrallah's bet on the demise of the Jewish state in the next few years, either by war or by peace (about this read the analysis of Nicholas Noe on his blog);
5. As always, the EU will be the follower of the US in changing the direction of its policy in the middle east. We have seen how the EU's leaders were out of touch in reacting to the current Arab revolts. This is why Israeli FM Lieberman was discussing current events in the Arab world at the EU parliament today, where he incurred a citizen arrest made by journalist David Cronin.
Currently, Israel cannot impose any direct influence on US foreign policy in the Arab world and it is trying to do so through the EU. But, as the US is watching and the EU becoming a minor player in the ME, this can only give Israel time and nothing else...
Israel has reason to worry and we have reasons to celebrate...Arab public opinion will be dictating and imposing its agenda on Israel and the West from now on...