Foreign Authors, Local Agents

I'm in the process of finding a suitable agent for my completed novel (and hopefully my future career as a writer). I was wondering how important location is.

My predicament is that I am Norwegian living in Norway, but my novel is written in English (having lived overseas most of my life, this is my preferred language). Finding an agent in Norway is futile (writers go directly to publishers here and there is no real market for Engish books). To complicate matters further, I expect to relocate overseas again within a couple of years (location unknown). My question then is: should I seek representation in the UK (i.e. closer to me at the moment) or USA (where the storyline of this first novel is set)?

Also, is the fact that I am "overseas" a discouraging factor for literary agents when considering to take me on as an client?

No. To be fair, yes, there are a few who will say no on that basis, but I can't think of any agents I know off the top of my head. My boss certainly has a lot of overseas clients. The most important thing is to get across that you are fluent in English, as we get some people who aren't completely fluent and an occasional person who thought running their book through Babelfish would be fine. Then email the agents with your query letter and see what happens. Email agents in both the UK and US to widen your prospects, not because of the location of the novel setting.