Most Canadians probably saw the Russian invasion of Georgia's breakaway provinces as nothing more than a local skirmish. After all, that's pretty much the way it was presented in the news media.

But it potentially represents much, much more.

One of the major clues to Russia's ambitions was their air strike on an oil pipeline across Georgia, which moves oil from Baku to the Black Sea, whence it is trans-shipped to Europe.

Russia has the world's largest oil reserves, at Baku and Grosny; it also wants to exploit the rest of the reserves in the Caspian Sea basin. And remember: Russia is developing strategic military, economic and nuclear technology alliances with Iran.

Historically, Russia has always wanted a warm-water seaport; and now that oil is the world's prime energy source, Putin and his puppet, Medvedev, want a stranglehold on oil, too. Russia's Gazprom supplies most of Europe's natural gas, and Neft supplies the lion's share of Europe's oil. This gives Russia enormous leverage over Europe's voice in international affairs. We saw that a few years ago when Russia arbitrarily doubled the price Ukraine had to pay for natural gas.

In addition, Russia-and Putin, personally-have gained vast wealth from the recent increase in oil and gas prices.

But there's another implication to the Russia/Georgia conflict: China is watching to see what the USA, NATO and the UN will do, because China wants to recapture Taiwan. If the world is lax in disciplining Russia's invasion of Georgia, China will be emboldened to invade Taiwan.

Of the two, Russia is probably the more dangerous. China's ambitions seem to be limited to gaining hegemony over the China Sea shipping lanes and dominating commercial markets. But China also wants access to Caspian Sea oil-and the hidden oil card in this conflict could bring the two communist giants together again. That would be bad news for the world.