The disputed South China Sea is a simmering pot of potential conflict that could have major consequences for the West, warns the author of a new book.

In his new book "Asia's Cauldron: The South China Sea and the End of a Stable Pacific," (Random House) geopolitical analyst and author Robert Kaplan deconstructs the volatile situation that has been bubbling in that region of the world.

He argues that the geopolitical tug-of-war taking place in the disputed South China Sea -- a resource-rich area that touches a number of maritime boundaries -- has so far largely been ignored.

"The pot may be brewing in Europe and the Middle East, but that doesn't mean Asia is any more stable," Kaplan told CTV's Canada AM on Tuesday. "We've been taking Asia's stability for granted for too long," he said.

The South China Sea dispute involves six countries: Brunei, China, Malaysia, the Philippines, Taiwan and Vietnam. Each country has laid claim to the entire sea or parts of it. Also at stake is the East China Sea. In November 2013, the Chinese government declared an air defence zone over a large swath of the area. The zone, which has been sharply criticized by Washington, includes disputed remote islands controlled by Japan.

These turbulent areas may become a flashpoint for a series of conflicts that may draw in the United States and may destabilize international financial markets, argued Kaplan.

"Asia's been in the midst of one of the world's greatest arms races," he said.

Of particular concern is China, notes Kaplan, which has been beefing up its military spending over the years. In March, the Chinese government announced it plans to hike its defence budget by 12.2 per cent. According to Xinhua, the country's state news agency, that increase represents the highest growth rate since 2011.

In a hypothetical situation where China has the world’s largest navy and the U.S.’s military prowess has diminished, Kaplan said “the chances of a war between China and Japan would go up measurably." The possible war would then roil international financial markets, and China would be in a position to jeopardize the sovereignty of its surrounding countries, including Vietnam, the Philippines and Malaysia.

On Tuesday, the spectre of a military conflict that would potentially involve the U.S. over the disputed South and East China seas became more apparent. U.S. Defence Secretary Chuck Hagel told his Chinese counterparts that the country has no right to unilaterally establish its air defence zone.

"Every nation has a right to establish an air defence zone, but not a right to do it unilaterally with no collaboration, no consultation," he said.

He added the U.S. will protect Japan, the Philippines and other allies involved in the dispute with China.

According to the Center for Strategic and International Studies, the UN Convention on the Law of the Sea does not outline how to resolve sovereignty disputes over territory.

"The good faith and willingness to make concessions that would be needed to negotiate the claims to the feature do not exist," CSIS said in a July 2013 report on the disputed areas.

Kaplan has written over a dozen books and is a non-resident senior fellow at the Center for a New American Security in Washington, D.C.

With files from the Associated Press.