Oil prices are soaring while the economy flat-lines in anticipation that Europe will next week join the US in choking Iranian oil revenue. Tehran in response is saber-rattling and threatening to close off the Strait of Hormuz.

And while all this unfolds, Iranian President Mahmoud Ahmadinejad is in a four-country Latin American tour that started in Venezuela, where his counterpart Hugo Chávez honored him with the customary “brotherly” welcome, his fifth in the Caribbean country, home of the world’s biggest oil reserves.

Clowning around aside though (and I’m referring to a round of nuclear jokes cracked by Ahmadinejad and Chávez), these two seemingly detached events offer valuable lessons to avoid another tit-for-tat diplomatic standoff spiraling out of control to choke Venezuela’s vital output and potential.

The State Department earlier this week expelled Venezuela’s consul in Miami following audio revelations that she was allegedly scheming –along with Iranian and Cuban diplomats- to carry out cyber attacks on US interests, the latest of an escalating and concerning trend.

I won’t delve much into the accusation, which Chávez expectedly brushed off. For the record though, I’m incredulous that any of the three countries allegedly involved have any cyber-warfare capability to threaten US interests. Venezuela can’t even increase oil production and Iran can’t even defend its own country from viruses (think Stuxnet), so cyber attacking the US seems unrealistic.

More importantly, Chávez is not and will not seek a nuclear bomb; Chávez can’t even cut crude exports in solidarity with Iran; he will not even go out of its way to help Iran, and, most emphatically, Venezuela is not gearing for asymmetric war against the US, with Iranian backing.

Chávez’s reelection, and thus his Revolution, is at stake. He won’t hack his way into a crisis. If Iran’s experience has taught the caudillo anything is that the US will not sit idly when its security is threatened, even potentially.

On the other hand, world oil production and spare capacity is insufficient to make up for lost Iranian and Venezuelan crude, even if Persian Gulf Countries get an extra couple of years to boost production. The globe’s economy would not be able to cope with a long-term Iranian shut in, lest if Venezuela’s output is increasingly threatened by a geopolitical tiff with the US.

This is not a defense of the Chávez regime, far from it, but a simple exercise of filtering out hyped fear-mongering to be expected during an election year, coincidentally in the US, Iran, and Venezuela. The Obama administration’s reaction though is counterproductive to America’s best interests, especially because it’s motivated by a misguided political calculation.

“This decision makes it even more apparent that Washington is unwilling or unable to implement policies that will constructively influence Latin America,” said an analysis published by the Washington-based Council on Hemispheric Affairs, a think tank, about the consul’s expulsion. The Obama administration doesn’t care about Latin America, it goes on, “however, votes could be picked up from rightist exile groups (in the US) coming from Cuba, Nicaragua, and Venezuela among other disaffected conservatives, who hold passionate thoughts on their personal political agendas.”

The Obama administration might not know this, but most Hispanic voters could care less about Cuba and Venezuela, at least enough to sway their vote. Like other Americans, they vote for their best interests, which is not in any foreign land. The vast majority of Hispanic voters, in fact, don’t have any direct ties to Cuba or Venezuela, although those who do weigh disproportionally in Florida politics, a swing state.

Nonetheless, it’s naïve to conclude that cherry-picking for votes by confronting Chávez and Cuba is worth compounding Iranian-rooted bullish pressure on oil prices. And it’s certainly not helpful amid a sluggish economic recovery that is increasingly undermining America’s very ability to address its real security concerns, like China, Russia, and of course Iran.

Chávez loves Ahmadinejad, but not because of the convoluted conspiracy theories broadcast from Miami. Iran’s nuclear standoff is simply the best thing to have happened to Venezuela’s Bolivarian Revolution. Since October, when Europe’s debt crisis was just warming into a doomsday double-dip scenario, WTI crude prices have risen $20 a barrel, almost entirely on the back of Iran.

Chávez is thrilled (although Vladimir Putin of Russia must be happiest of all) because he has even more cash to consolidate his advantage ahead of October elections. And considering the horrid economic mismanagement in both Venezuela and Iran, I can understand why their leaders had such a big laugh in Caracas.

Each country has pocketed at least a couple of billion extra dollars in three months, based on WTI prices over the period, precisely when market fundamentals would dictate price declines because Libyan production is recovering and because demand is falling faster than anticipated in rich countries.

It’s perfectly understandable that the US and its allies would do anything in their power to stop Iran from developing nuclear weapons. It’s a question of national security, which trumps all other considerations, including the economy.

But how –and I ask this in 2012- is Chávez a threat? The US imports around 1 million bpd from Venezuela, which also owns Citgo and other refineries. Bilateral business ties, despite the ideological headline war, illustrate that Chávez is at most a huge annoyance.

The Venezuelan consul’s expulsion follows last year’s US sanctions on state oil company and world mammoth PDVSA –fruitless of course-. Both countries have rejected each others’ ambassadors and diplomatic relations are all but frozen.

Worse, calls to label Venezuela a terrorism sponsor are growing increasingly loud, especially ahead of elections. Republican senators next month will hold a hearing on Iran’s dangerous liaisons in Latin America, including alleged help from Chávez for terrorism activities that US authorities have not found evidence for.

Is it in America’s interest to escalate a tamed standoff with Chávez that is mostly refrained to rhetoric? Does the US really want a diplomatic spat brewing into an Iranian-type quagmire just south of Miami?

Chávez will jump at US headline-grabbing diplomacy. He thrives on any attention, especially negative one, coming from Washington. And in this election cycle, it’s extra political ammunition on top of the extra oil revenue from rising oil prices.

So it doesn’t add up that the US would throw him a bone in this juncture.

Andrés Cala and Michael Economides are co-authoring America’s Blind Spot: Chávez, Oil, and US Security, a book analyzing US national security and how it transits through Latin America. The book will be published this summer.