For The Moment, the Shock Is Limited

Oil and war do not mix. In 1973, when the Middle East erupted in the October War, the world was hit with Oil Shock No. 1. Then in 1979-80, after revolution broke out in Iran and the country was invaded by Iraq, came Oil Shock No. 2. In both cases petroleum prices soared, energy shortages developed, inflation took off, and the world's economies sank into recession. Last week fears of Oil Shock No. 3 could be felt from New York City to Tokyo.

The price of West Texas Intermediate crude, the benchmark for trends in the U.S. oil market, ended the...