The immediate effect will be some violence, a third Intifada, which the Israeli military estimates will be not as bad as the previous one. But this estimate does not take the political effects into account. Clearly, Abbas will be weakened and lose prestige with his people, while Hamas will be "proven" to have been "correct" in their negative attitude towards talks. 1. The result may very well be a unilateral declaration of an independent Palestinian state. I doubt that the US will veto admittance of this state to the UN. From there it will cause endless diplomatic trouble to Israel. 2. Another possibility is that Abbas will simply retire. By law, his temporary successor is the speaker of Parliament, a Hamasnik. 3. Alternatively to point #2, but perhaps leading to the same outcome, is that the PA will dissolve itself, forcing Israel to exercise direct control over the West Bank. No more donations from the world, the financial burden will fall on Israel, as well as the stigma of Apartheid. Not pretty.
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Palestinian Health Ministry: 20-year-old man killed in clashes north of Hebron (Haaretz)
from the article: The end of Oslo