Your 5-minute update in risk appetite | June 2022
Country Risk: How the Russia-Ukraine conflict impacts the energy sector.
Why Europe risks to be particularly affected.
The invasion of Ukraine by Russia has a major impact on the energy sector (besides many other industries, especially the agri-food sector). There is a broad spectrum of effects: disrupted production and distribution, bans and sanctions countered by export stops, shifting supply chains, and fluctuating prices due to supply and demand uncertainties.
Important medium- to long-term implications are to be expected.
The EU region could be strongly affected. In a worst-case scenario, including a stop in Russian oil and gas exports, the GDP loss in 2023 could amount to 3%, according to the IMF World Economic Outlook of April 2022.
Energy dependence on Russian exports
Russia is the world’s largest exporter of oil to global markets and the second-largest crude-oil exporter (after Saudi Arabia) (source: IEA). It is also the largest natural-gas exporter in the world. European countries remain particularly dependent.
Western bans and Russian countermeasures
Major shifts in the supply chain
Supply deficits could further increase oil and gas prices and lead to disruptions in deliveries. In the medium to long term, a large-scale reorientation of trade flows will take shape.
The impact of weaning Europe off Russian gas
What if Russia would put an immediate stop to all gas supplies?
How will the ‘RePower EU’ plan affect matters?
For more information on the effects of the conflict on sectors and countries, please contact your Account Manager.
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