The release by Scottish authorities of convicted Libyan intelligence agent Abdel Baset Al-Megrahi from prison has created an extremely negative emotional reaction in the United States and other countries. Moved by anger towards the injustice displayed by Scottish authorities to the families and survivors of the victims of the terror attack against Pan Am 103, Americans and large segments of international public opinion are furious over the release of the convicted terrorist, even under the so-called Scottish legal values based on "compassionate release" due to terminal illness.

These exceptional stipulations for "compassionate release", when applicable, are designed for criminal cases where one person killed another individual under complex circumstances. A sudden terminal illness is perceived as enough punishment by nature or the divine to grant a severely conditioned release to the family, without any affront to justice and pain to the survivors of the victim. --But that is one thing and granting freedom to a terrorist who murdered hundreds of innocents civilians bound on an airplane is something that no Scottish, British, American or international legal values permit.

The statements made by Scotland's Minister of Justice should not stand in this case. This was no regular murder, this was a mass murder and compassionate release can only be was granted by the survivors of the victims.-- That obvious fact should have been legally considered by the full-fledged power of the national legislatures in Britain and the United States. The United Kingdom should have superceded Scottish humanitarian procedures instead of surprising the latter with alleged legal "technicalities." Legally Edinburgh was wrong, and morally London was as wrong. 

But the matter is even more serious than the media and political sensationalism make it out to be. The bigger picture is more ominous. It relates to the present crumbling of Western strategic behavior. The diplomatic and political handling of the oppressive Libyan regime is the root cause of the Al-Megrahi's scandal.

Here is why:

To begin with, the Libyan regime, not the execution agent of Libyan intelligence, should have been prosecuted years ago. No loyal Mukhabarat operative would mount such an operation against civilian targets without orders from a superior. And these orders can not be produced outside a strategic order to strike at the United States by the regime leader himself, Colonel Muammar Qaddafi. 

The initial framing of the Lockerbie settlement is also ridiculous -- the state jails an agent for a massacre ordered by the head of a regime. This was an act of terror against international law and should have been prosecuted by a special international tribunal at The Hague. Among the first officials to have been summoned should have been the dictator himself. Milosevic was brought in; Bashir was indicted; Muammar Qaddafi should have been, too.

"Tripoli's mad man," as Egypt's Anwar Sadat and many other Arab leaders have called him, is not new to terrorism. Way before Lockerbie he bankrolled scores of terror organizations in the Middle East, Africa and Latin America. He has incited mass violence from the Philippines to India, as well as embraced extreme anti-Semitic rhetoric. In 1978 he lured a top Lebanese Shia cleric, Imam Musa al Sadr to Libya and executed him. He fomented coups in Tunisia and Egypt and invaded Chad. 

The list is too long but memory seems to be very short on both sides of the Atlantic. Qaddafi's prisons are tenfold Abu Ghraibs. Hundreds of political prisoners languish in dark cells.

After repeated Libyan-sponsored acts of terror, including those against American military personnel in Germany, the U.S. responded on April 15, 1986 with an air raid on the regime's military installations.-- Qaddafi most likely ordered the destruction of an American airliner in December 1988 as revenge and possibly as well in conjunction with Iranian incitement. The massacre of the passengers aboard Pan Am Flight 103 was a regime planned war crime, but was never punished as such.

As the decade came to an end and Gorbachev brought about reforms followed by the end of the USSR, Muammar began a slow behavior change -- his main backer having crumbled. Libya shrunk but didn't end its involvement in terrorism and radicalization, particularly in Africa. But with the crumbling of Saddam regime and his capture, Qaddafi moved quickly to cut a deal with the U.S. and the West.

He let go, at least for the time being, of his nuclear ambitions, and accepted a deal to offer financial compensation to the families of Pan Am Flight 103. Instead of accepting responsibility for the bombing, the Tripoli regime offered Al-Megrahi as a "single operative" to be prosecuted and jailed, so that the case would be closed.

For as long as the U.S. was on the offensive against "global terrorism," Qaddafi stayed on the defensive. But as soon as Washington changed direction and opted for engagement with the regimes in the region, particularly the oil producing ones, Qaddafi rushed to consolidate his regime at home and in the region.

The chief goal was to show that he could bring Western governments to accept his diktat. In a speech (available as a video online) he revealed to his supporters that, according to the arrangements, he had all the compensation his government paid for Lockerbie returned to his coffers by oil companies rushing back to do business in Libya. "What I gave with my right hand, the other hand received back," he said. And to restore his image of an unsanctioned dictator, he cut a deal on Al-Megrahi. -- He would be returned to Libya as a hero, even if chanceries in the West issued formal protests.

Qaddafi is enjoying the new era of engagement. "They won't do anything against us," he told cheering supporters. Indeed, the Lockerbie "compassion" seems to be more for petrodollars than so-called local values.

Terror expert Dr. Walid Phares is FOX News contributor and a senior fellow with the Foundation for Defense of Democracies and the author of "The Confrontation: Winning the war against Future Jihad."