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.S. presidential election was watched closely all over the world, but the outcome mattered particularly to Israel, where the enmity between Israeli Prime Minister Benjamin Netanyahu and newly-re-elected U.S. President Barack Obama is anything but a secret. 

It was also no secret that Republican challenger Mitt Romney was the favorite among Israelis (to the tune of 59 percent favorability rating, versus Obama's 22 percent) and the Israeli government (Romney and Netanyahu were Harvard Business School buddies). 

Romney's unashamed declaration that Jerusalem is capital of Israel, a point the U.S. Democratic party and President Obama have deemed controversial, also helped his standing among American-Israelis, who strongly turned out in favor of Romney, the AP reported, by a factor of 85 percent.. Even before election day arrived, analysts were estimating that if Israel were a U.S. state, Romney would have been victorious.

But Israeli arose on Wednesday morning with a continued Obama presidency. And now two questions hang over the Knesset in Jerusalem: What will Obama's next term mean for Israel's own elections in January? And what will Obama do, or not do, about Iran's nuclear weapons? 

Predictably, there are some soothsayers of doom, such as David Weinberg's column in Israel Hayom on Wednesday, wherein he warned Israelis about Obama's "anti-Netanyahu campaign" and that relations are sure to further wither if Netanyahu is re-elected, potentially leaving Israel in the lurch. 

Similarly, Likud Member of the Knesset Danny Danon called Obama "naive" and suggested that America had now left Israel to fend for itself, the right-leaning blog The Algemeiner reported . 

But others were more optimistic. Jonny Daniels, Danon's Chief of Staff who recently revealed the he himself is mulling a Knesset run, said that an Obama second term could work in Netanyahu's favor for the January elections. 

"This could really help Bibi [Netanyahu]," Daniels said, speaking from Tel Aviv. "There's a school of thought that Obama doesn't have to give into the liberal base now, and might actually be better on this issue [of Iran]." 

"Potentially, this could play out for the best," Dnaiels continued. "Bibi has to be very careful how he plays it. He doesn't want to be the Prime Minister that stands up to Obama, but he still needs to stand strong for Israel."

Standing up to pressure from a foreign president might be exactly what clinches the election for Netanyahu, Shmuel Sandler, a professor at Bar-Ilan University, told the Jewish Daily Forward . 

“If he’s too rough with Netanyahu, it will be counter-productive,” said Sandler to the Forward. “It will make people rally around Netanyahu. People don’t like when someone from outside pressures us [Israelis].”

"The truth is, there's a limit to how much Obama can do to us," Daniels said, noting the Republican majority in the U.S. House of Representatives.

"I think if anything, this [Obama's re-election] brings war with Iran closer. There's definitely a level of mistrust between Obama and Bibi, that's for sure," he added.

Netanyahu is left in a rather awkward position now that he so vocally backed the losing horse. His statement congratulating Obama, released almost immediately after the election was officially called, was nothing if not an attempt to defuse tensions. 

Netanyahu said that he will "continue to work with President Obama to ensure the interests that are vital for the security of Israel's citizens," but implied in an interview with Arutz Shtaim that Israel would act against Iran alone if it came down to it.

Obama's re-election also has some prominent Israel politicians weighing their own chances come January.

"People like [Tzipi] Livni [former head of the the opposition party Kadima] and [former Prime Minister Ehud] Olmert are waiting to see if they will re-enter politics," Daniels said, "And a lot of that is based on yesterday's [Wednesday's] election."

Israel's left-wing Haaretz newspaper has revealed that Livni has been pushing current Israeli President Shimon Peres to leave his post and run for head of Kadima, citing anonymous sources that say Livni "doesn't feel comfortable" being number two to Olmert and that Peres would be a stronger candidate to "topple" Netanyahu.

The Israeli elections are currently scheduled for January 22, 2013.

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