The sharp fall in oil prices engineered by Saudi Arabia will likely be fairly short lived, and indeed sets the stage for the next major rally in oil prices. Though oil prices could stay at or well below recent levels for at least another 6 to 9 months, within the next 12 to 18 months, odds look much better than 50-50 that oil will spike closer to all-time highs than languish at current prices. The Saudi actions will have significant short- and longer-term economic and political implications; these could prove foundational vis-à-vis how to position your portfolio. Shorter term it brings us much closer to a bottom in the commodity price correction that began with the European recession in 2011. But first things first. The two economic blocs that stand to benefit most from the price cut are the Europeans and Chinese. The lower prices give both economic blocs, as major oil importers, a free shot in the economic arm. More cash in the hands of the populace without the need for any government to lay out a penny.

On balance, however, lower oil prices will provide a mixed blessing to America. On one hand, the country’s most dynamic industry, energy production, may crumble. On the other, U.S. consumers will retain more cash in their pockets. Moreover, stock investors should note that since OPEC first flexed its muscle in the early 1970s, America has never experienced a major market decline during a bear market in oil prices.

So on balance, good for Europe, okay for America, but the biggest winner by a wide margin is China. There, the drop in oil proves a manifold blessing. Chinese consumers obtain a de facto tax cut; the yuan, as a result obtains more freedom to follow its upward trajectory—further boosting consumer demand as well as Chinese wherewithal to import all that military, industrial and consumer technology that the Middle Kingdom so ravenously craves. Better times in Europe should also help offset the higher yuan as European consumer spending picks up. As a bonus, China can buy oil on the cheap for its rainy day stockpile.

Not everyone in the East—China’s sphere—will win in the short term. As long as low oil prices last, Russia will be among the losers. But don’t tell the Russians. Though not an OPEC member, Russia explicitly ruled out making a deal with OPEC that would lower oil prices. Russia acts like a good mercenary soldier—playing along with the plan for the long-term good of the whole. However, even in the short term China has probably promised Russia greater investments, where else but in the energy industry. Additionally, China will probably gain more military technology as well as cyber cooperation.

And Russia will probably face no push back from China as it inks energy deals with India. That’s right, India, our so-called democratic friend, has been cozying up to Russia and promised to invest in the Russian oil industry. India, the world’s third-largest oil importer, is desperate for long-term supplies as it ramps up its growth. As for those Western sanctions against Russia, they apply to Russian companies and not the government. Of course, Putin is taking something of a risk. Russia will likely experience a recession in 2015 and Putin’s popularity could wane, but given the situation in Europe further sanctions look unlikely. Moreover, Putin remains extremely popular; most important, more world growth and less oil supply should mean that not too far into the future, much higher oil prices, following all that investment, will put Russia much closer to gaining a long-term catbird seat. Further, Russia for most of the 1990s survived economic times virtually unimaginable to Americans, times so tough that life expectancy fell by nearly 5 years. Perhaps America has never experienced a decade so dire during peacetime. The ability to explain Russian tolerance for economic pain stands a pay grade above mine, but Russians in anticipation of bad times seem historically to have stored such tolerance in deep root cellars, clearly suggesting that one year of a relatively mild recession is a very small price to pay to access long-term gains and coalesce some form of mutual hegemony with China.

Any discussion of the East and especially the Mideast must note that commonly accepted notions such as transitivity do not apply. For example if A wants to help B and C wants to beat B, A and C can still be allies. If A is Iran, B is Syria, and C is Saudi Arabia, consider this an example of the relationships that rule rather than the exception in the Middle East. The hideous Assad regime in Syria is only one reason to suppose that Iran and Saudi Arabia would be natural enemies. The different views on Syria are partially informed by differences in how the two states interpret Islam, with Iran like Syria’s Assad being Shi’ia and the Saudis being Sunni. Yet the countries continue to coexist and have well-defined diplomatic ties. Both countries are united against ISIS. And both stand to gain from growing Middle Eastern economies.

Seemingly Russia, a strong ally of Syria’s Assad, the provider of much nuclear technology to Iran and a competitor to Saudi Arabia for oil exports, would be wholly in Iran’s corner vis-à-vis Saudi Arabia. But remember this is the Middle East and Russia’s decision to ally with Saudi Arabia to maintain high oil supplies ran contrary Iran’s wishes. Moreover, Saudi Arabia and Russia have had dialogs at the highest diplomatic levels. And even on the issue of Syria, they agree that more important than the fate of Assad is for Syria to remain a traditional state with laws. Russia’s support for Assad comes from Russia’s desire to keep its port on the Syrian coast. That port does not depend on the survival of Assad but the survival of a Syrian government friendly to Russia. On this score, we note that Russia’s relations with Israel have also taken a marked turn for the better. Indeed, Israel, arguably America’s strongest ally, did not endorse sanctions against Russia over Ukraine. Perhaps Russia calculates that whatever happens in Syria, Israel will play a major role maintaining regional peace.

China could prove a form of glue to tie all these relationships together. It has two major advantages to unite the East. First, by a wide margin, it is the East’s largest economy and still one of its fastest-growing economies. Second: the country’s politics, religion, and economics all sit in one bucket, whose main purpose is to secure the long-term wellbeing of its populace.

China does not seek hegemony for the sake of hegemony but only to obtain enough power to secure its economic future. Mutual prosperity could also provide a potential glue to tie many natural enemies ranging even from Iran to Israel together—or at least we think that may be Xi’s calculus, and from given history, we see a good argument for it.

It would mean that all countries in what China recently defined as the Silk Road should secure mutual economic benefit from ties with China at the center.