The development of North America's vast shale oil deposits is creating a shock wave that is reaching virtually all recesses of the global oil market, according to the International Energy Association. It is possible to look forward - expectantly or with trepidation - to a world once again awash in oil.

For instance, although the report, the Medium Term Market Report for 2013, doesn't go into it, the North American supply revolution of so-called light tight oil (LTO) can be also expected to have consequences far beyond the supply of crude itself. As the amount of oil going onto world markets increases, it risks driving up carbon dioxide levels, the most important component of greenhouse gases, which were reported last Friday to have already reached the highest level in human history, at 400 parts per million at monitoring station in Hawaii.

"What we see today is 100 percent due to human activity," Pieter Tans, a senior scientist with the National Oceanic and Atmospheric Administration, told Bloomberg News. Climate experts have been expecting the 400 ppm mark, which climate scientists fear is too high for plants and animals to adapt.

Other countries including China, Russia, India and some in South America are reporting good results in applying technology used in the US and Canada, meaning that: "Although uncertainties remain, it is impossible to ignore the possibility that current non-conventional technologies, as they spread and get both perfected and mainstreamed, could lead to a wholesale reassessment of global reserves. Although challenges abound and the full impact of this transformation may not occur until after our forecast period, expectations of future resource availability and production potential are already undergoing a sea change."

This technological revolution in North America also probably means a two-step recovery in the developed world, with the United States, the world's biggest economy, resuming growth on plentiful energy at a time when European Union nations, already struggling with debt and declining economies, will face an increasing problem sourcing energy from a politically troubled MENA - Middle East-North Africa—region.

The production of shale deposits is also having a considerable effect on the US's perennial balance of payment problem, with petroleum product exports exceeding imports in February of 2012 for the first time since 1949 - 64 years ago, according to the US Energy Department, and presumably its political situation as well. In 2010, net imports remained at 269,000 barrels per day. The current export figures for gasoline, heating oil and diesel come at a time when US fuel consumption continues to sink because of weak economic conditions and rising car mileage standards. US consumption has fallen by 2 million barrels per day since 2005.

At the same time, North American production is expected to grow by 3.9 million barrels per day to 2018, according to the IEA report. That will mean lessened dependence on the part of the US and Canada on for the troubled MENA region, beset by political instability since the so-called Arab Spring.

"Several members of the (MENA) producer group face new hurdles, notably in North and sub-Saharan Africa. The regional fallout from the 'Arab Spring' is taking a toll on investment and capacity growth. Security risks are on the rise, compounding the uncertainty about future changes to the oil laws and investment regime," the IEA report says.

"Two years into the region's process of far-reaching social and political transition, the biggest challenges lie ahead. A resurgent Iraq remains the largest single source of incremental OPEC capacity, but a host of above-ground problems - administrative hurdles, delays to contract awards, disagreements over payments between Erbil and Baghdad, lingering security risks and problems in executing investment and production plans - are bogging down development."

In every other aspect of the supply chain - demand, refining, trade or storage and transportation, the rise of the non-OECD region is striking, the report notes, with emerging market and developing economies projected to overtake the advanced economies in oil product consumption as of the current quarter of 2013 and to widen their lead through the forecast period, jumping from 49 percent of global demand in 2012 to more than 54 percent by 2018. In addition, these countries are increasingly taking over refining, with most of the world's refining capacity already located in the developing countries - following the global manufacturing base out of both the OECD and North America.

The non-OECD countries include some of the world's fastest-growing economies, including the so-called BRICS countries - Brazil, Russia, India, China and South Africa, among others.

Taken in aggregate, OECD refining notwithstanding a renaissance in the US, is increasingly relinquishing market share to the non-OECD region, a form of de facto off-shoring not unlike the trend in other manufacturing sectors. Already most of the world's refining capacity is located in non-OECD economies.

"As trade patterns shift, new trading hubs are emerging at both OECD and non-OECD strategic locations such as Northwest Europe and the Caribbean," the report notes. "Storage terminals are being expanded along the African coast amid rising African imports of LPG and transportation fuels. Non-OECD companies are expanding their international footprint in some of those strategically located terminals, while trading firms seek to expand and leverage their storage assets to arbitrage emerging supply/demand imbalances."

A long list of factors will shape market developments over the next five years, ranging from the impact of sustained high oil prices to shifts in the global economy, including Europe's continuing debt crisis and China's changing pace of growth as the country seeks to shift from an export-led economy to a service one.

The outcome of the Syrian conflict and the international dispute over Iran's nuclear plans will play a role. However, "While continued uncertainties remain about the economics and ultimate impact of unconventional production technologies, recent developments in North American supply stand out as an overarching driver, coloring the way in which virtually all other factors impact the market, and causing ripple effects through all aspects of the oil industry, from supply to demand and all the links in between."

The rising North American supply has played a critical role, for instance, in offsetting record supply disruptions in 2012 including those in Syria, Sudan and Yemen which took about 1 million barrels per day off the world market. In previous crisis periods, such disruptions drove domestic prices up dramatically.

"The case of US LTO is distinctive in that rising production is causing an unexpected quality shift in the global crude mix. While many supply growth forecasts had long been predicated on the notion of a shift in crude quality towards heavier and sourer grades, LTO is exceptionally light and sweet, including large volumes of field condensate."

Another distinctive trait of the North American supply boom is that it is taking place at the heart of one of the world's most highly industrialized, mature economies, the report notes. The emergence of large-scale new supply in such a context will necessarily play out very differently from the way in which a comparable increase might affect the market if it came from a Middle East or sub-Saharan producer.

"The initial impact of the LTO boom on global crude markets has thus been indirect: rather than seeking out export markets, the new supply has so far affected international crude markets mostly by backing out imports. Future growth could be constrained by logistical and marketing challenges, however.

Last but not least, the surge in US shale gas production and associated shifts in natural gas pricing are challenging the conventional wisdom about fuel switching and gas-in-transport. Cheap and abundant natural gas has already facilitated the transition of the US economy towards broader use of the fuel. That has meant a collapse in the share of US power generation held by coal. "The conversion of US space heating from oil to gas was well underway before the shale gas revolution, and the scope for further substitution is comparatively limited. Oil to- gas substitution in transport would have a larger impact as the sector accounts for the lion's share of oil demand. Long seen as a remote possibility, transport gas now looks much closer to becoming a reality. This is true not only of the US market but also of China and other gas producers such as Australia."

The primary driver of oil consumption growth is the economy, but global demand in the next five years will also be affected by the broader economic impacts of the North American supply revolution. The International Monetary Fund's World Economic Outlook of April 2013 notes a "growing bifurcation [within advanced economies] between the United Sates on one hand and the euro area on the other."

The two-speed pattern of economic recovery that had prevailed until now has thus evolved into a three-speed recovery characterized by a growing divergence in economic growth between three main blocks: non-OECD economies, low-growth European advanced economies and the US.