Mideast crude shifting from US & Europe toward Asia: Report

This trend will result in new sources of supply and increased competition, among other things

The ripple effects of the North American energy boom are being felt across the Middle East, Russia and China, says the Deloitte's 2014 Oil and Gas Reality Check report.

This trend will result in new sources of supply, increased competition, reshaping of the global geopolitical landscape and creation of greater interdependencies among nations, it says.

"This year, energy markets have been marked by geopolitical motivations and pragmatism to an extent never seen before.

"For the Middle East, crude cargoes are anticipating a shift as exports are increasingly being directed eastward toward Asia rather than westward toward the US and Europe," says Kenneth McKellar, Energy and Resources leader at Deloitte Middle East.

"However, we believe that predictions of US disengagement from the Middle East are over stated," he said.

The Deloitte report states that given the fungibility of world oil markets, a disruption in Middle East oil supplies will reverberate back to the US domestic market regardless of whether the region remains a major source of crude imports or not.

In addition, the region's volatility continues as the 'new normal' since the 'Arab Spring', it said.

The report said if the US is now less dependent on Middle Eastern supplies, demand from Asia and China have grown in this regard.

Sluggish domestic supply growth and poor pipeline economics left China with few options but to search out new supplies overseas, and it found them to a great extent in the Middle East.

"Today China is dependent on the Middle East for a large percent of its crude imports and Middle East exports to China are expected to rise," McKellar says.

The US is currently positioned to be a net exporter of natural gas by the end of this decade according to projections from the US Energy Information Administration (EIA), the report says.