Economic Consequences in Europe of the Russian-Ukraine 2022 War

Research Article
Open access

Economic Consequences in Europe of the Russian-Ukraine 2022 War

Yuhan Gong 1*
  • 1 Shenzhen College of International Education, Shenzhen, Guangdong, 518040, China    
  • *corresponding author s19097.gong@stu.scie.com.cn
Published on 21 March 2023 | https://doi.org/10.54254/2754-1169/4/20221073
AEMPS Vol.4
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-915371-17-1
ISBN (Online): 978-1-915371-18-8

Abstract

This paper discusses the economic consequences of the Russian- Ukraine war and mainly focuses on the economic impact it brings to Europe. On 24 February, Vladimir Putin launched an unproved invasion of Ukraine. The West responded by unleashing a series of sanctions to weaken the power of Putin’s war machine, but Russia responded with retaliatory measures. The war has caused supply chain disruption and hiked energy and food prices. Oil and gas prices both hiked to a record high. The Euro Area experienced an 8.1% inflation rate. The European Central Bank considered hiking interest rates for the first time in more than 11 years as a result of the strong inflation. The war increases volatility in the conventional stock market. Stock prices plunged significantly on the day of the invasion, but the market recovered shortly as the sanctions against Russia were imposed. As the war created enormous economic uncertainty and increased inflation across Europe, governments should devise effective policies to reduce the inflationary pressure and seek alternative energy sources to reduce the dependence on Russian energy exports.

Keywords:

Energy, Russian-Ukraine war, Financial Market, Stocks., Sanctions

Gong,Y. (2023). Economic Consequences in Europe of the Russian-Ukraine 2022 War. Advances in Economics, Management and Political Sciences,4,260-270.
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References

[1]. Watson, E. (2022, June 4). 100 days of Russia’s war in Ukraine: A timeline. CBS News. https://www.cbsnews.com/news/ukraine-russia-war-timeline-100-days/

[2]. Kirby, B. P. (2022, May 9). Why has Russia invaded Ukraine and what does Putin want? BBC News. https://www.bbc.com/news/world-europe-56720589

[3]. EU response to Russia’s invasion of Ukraine. (2022, June 24). European Council. https://www.consilium.europa.eu/en/policies/eu-response-ukraine-invasion/

[4]. BBC News. (2022, May 31). What sanctions are being imposed on Russia over Ukraine invasion? [Press release]. https://www.bbc.com/news/world-europe-60125659

[5]. de Luce, D. & Associated Press. (2022, June 17). Russia pressures Europe by slashing its natural gas supply [Press release]. https://www.nbcnews.com/politics/national -security /russia -pressures-europe-slashing-natural-gas-supply-rcna34122

[6]. Anna Cooban, CNN Business. (2022, June 1). Why Russia isn’t hurting even as it cuts off Europe’s gas. CNN. https://edition.cnn.com/2022/06/01/energy/eu-russia-gas-cut-off-value/index.html

[7]. Accenture. (2022, May 23). From disruption to reinvention: The future of supply chains in Europe. https://www.accenture.com/us-en/insights/strategy/ukraine-future-supply-chains-europe

[8]. Ozili, P. K. (2022). Global Economic Consequence of Russian Invasion of Ukraine. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4064770

[9]. Crude Oil Brent US Dollars per Barrel 2022. (2022, July 1). Countryeconomy.Com. https://countryeconomy.com/raw-materials/brent

[10]. Eurostat. (2022, March 7). Energy represented 62% of EU imports from Russia. https://ec.europa.eu/eurostat/web/products-eurostat-news/-/DDN-20220307-1

[11]. Russian supplies to global energy markets – Analysis. (2022, April 26). IEA. https://www.iea.org/reports/russian-supplies-to-global-energy-markets

[12]. Russian gas imports in the EU – threat or a chance? (2022, June 3). IHS Markit. https://ihsmarkit.com/research-analysis/russian-gas-imports-in-the-eu-threat-or-a-chance.html# %7E:text=Historically%2C%20Russia%20is%20the%20most,excluding%20the%20intra%2DEU%20trade.

[13]. Duthoit, A. (2022, May 23). European food inflation: and the loser is the consumer. Corporate.https://www.allianz-trade.com/en_global/news-insights/economic-insights/ european-food-inflation.html

[14]. TRADING ECONOMICS. (n.d.). Euro Area GDP Growth Rate - 2022 Data - 2023 Forecast - 1995–2021 Historical. https://tradingeconomics.com/euro-area/gdp-growth

[15]. Semenova, A. (2022, February 25). Stock market news live updates: Stocks stage massive comeback despite Russia invasion of Ukraine. Yahoo Finance. https://finance.yahoo.com/news/stock-market-news-live-updates-february-24-2022-232946494.html

[16]. BBC News. (2022a, February 25). Stock markets rebound on Russia sanctions. https://www.bbc.com/news/business-60518578

[17]. In focus: Reducing the EU’s dependence on imported fossil fuels. (2022, April 20). European Commission - European Commission. https://ec.europa.eu/info/news/focus-reducing-eus-dependence-imported-fossil-fuels-2022-avr-20_en#:%7E:text=REPower%20EU%20to%20cut%20dependence,and%20cost%20%E2%82%AC99%20billion.

[18]. Sturm, J., & Menzel, K. (2022). The Simple Economics of Optimal Sanctions: The Case of EU-Russia Oil and Gas Trade. SSRN Electronic Journal. https://doi.org/10.2139/ ssrn.4084754

[19]. Sturm, J. (2022, April 13). The simple economics of a tariff on Russian energy imports. VOX, CEPR Policy Portal. https://voxeu.org/article/simple-economics-tariff-russian-energy-imports

[20]. Trickett, N. (2022, July 1). Asia Can’t Save Russia’s Energy Sector. The Diplomat. https://thediplomat.com/2022/06/asia-cant-save-russias-energy-sector/

[21]. Statista. (2022, July 12). Urals oil price discount to Brent daily 2022. https://www.statista.com/statistics/1298092/urals-brent-price-difference-daily/#statisticContainer

[22]. BBC News. (2022c, July 21). Eurozone raises interest rates for first time in 11 years. https://www.bbc.com/news/business-62240730

[23]. Blanchard, O., & Pisani-Ferry, J. (2022). Fiscal support and monetary vigilance: economic policy implications of the Russia-Ukraine war for the European Union. Bruegel. http://www.jstor.org/stable/resrep41304

Cite this article

Gong,Y. (2023). Economic Consequences in Europe of the Russian-Ukraine 2022 War. Advances in Economics, Management and Political Sciences,4,260-270.

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About volume

Volume title: Proceedings of the 6th International Conference on Economic Management and Green Development (ICEMGD 2022), Part Ⅱ

ISBN：978-1-915371-17-1(Print) / 978-1-915371-18-8(Online)
Editor：Canh Thien Dang, Javier Cifuentes-Faura
Conference website: https://www.icemgd.org/
Conference date: 6 August 2022
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.4
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. Watson, E. (2022, June 4). 100 days of Russia’s war in Ukraine: A timeline. CBS News. https://www.cbsnews.com/news/ukraine-russia-war-timeline-100-days/

[2]. Kirby, B. P. (2022, May 9). Why has Russia invaded Ukraine and what does Putin want? BBC News. https://www.bbc.com/news/world-europe-56720589

[3]. EU response to Russia’s invasion of Ukraine. (2022, June 24). European Council. https://www.consilium.europa.eu/en/policies/eu-response-ukraine-invasion/

[4]. BBC News. (2022, May 31). What sanctions are being imposed on Russia over Ukraine invasion? [Press release]. https://www.bbc.com/news/world-europe-60125659

[5]. de Luce, D. & Associated Press. (2022, June 17). Russia pressures Europe by slashing its natural gas supply [Press release]. https://www.nbcnews.com/politics/national -security /russia -pressures-europe-slashing-natural-gas-supply-rcna34122

[6]. Anna Cooban, CNN Business. (2022, June 1). Why Russia isn’t hurting even as it cuts off Europe’s gas. CNN. https://edition.cnn.com/2022/06/01/energy/eu-russia-gas-cut-off-value/index.html

[7]. Accenture. (2022, May 23). From disruption to reinvention: The future of supply chains in Europe. https://www.accenture.com/us-en/insights/strategy/ukraine-future-supply-chains-europe

[8]. Ozili, P. K. (2022). Global Economic Consequence of Russian Invasion of Ukraine. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4064770

[9]. Crude Oil Brent US Dollars per Barrel 2022. (2022, July 1). Countryeconomy.Com. https://countryeconomy.com/raw-materials/brent

[10]. Eurostat. (2022, March 7). Energy represented 62% of EU imports from Russia. https://ec.europa.eu/eurostat/web/products-eurostat-news/-/DDN-20220307-1

[11]. Russian supplies to global energy markets – Analysis. (2022, April 26). IEA. https://www.iea.org/reports/russian-supplies-to-global-energy-markets

[12]. Russian gas imports in the EU – threat or a chance? (2022, June 3). IHS Markit. https://ihsmarkit.com/research-analysis/russian-gas-imports-in-the-eu-threat-or-a-chance.html# %7E:text=Historically%2C%20Russia%20is%20the%20most,excluding%20the%20intra%2DEU%20trade.

[13]. Duthoit, A. (2022, May 23). European food inflation: and the loser is the consumer. Corporate.https://www.allianz-trade.com/en_global/news-insights/economic-insights/ european-food-inflation.html

[14]. TRADING ECONOMICS. (n.d.). Euro Area GDP Growth Rate - 2022 Data - 2023 Forecast - 1995–2021 Historical. https://tradingeconomics.com/euro-area/gdp-growth

[15]. Semenova, A. (2022, February 25). Stock market news live updates: Stocks stage massive comeback despite Russia invasion of Ukraine. Yahoo Finance. https://finance.yahoo.com/news/stock-market-news-live-updates-february-24-2022-232946494.html

[16]. BBC News. (2022a, February 25). Stock markets rebound on Russia sanctions. https://www.bbc.com/news/business-60518578

[17]. In focus: Reducing the EU’s dependence on imported fossil fuels. (2022, April 20). European Commission - European Commission. https://ec.europa.eu/info/news/focus-reducing-eus-dependence-imported-fossil-fuels-2022-avr-20_en#:%7E:text=REPower%20EU%20to%20cut%20dependence,and%20cost%20%E2%82%AC99%20billion.

[18]. Sturm, J., & Menzel, K. (2022). The Simple Economics of Optimal Sanctions: The Case of EU-Russia Oil and Gas Trade. SSRN Electronic Journal. https://doi.org/10.2139/ ssrn.4084754

[19]. Sturm, J. (2022, April 13). The simple economics of a tariff on Russian energy imports. VOX, CEPR Policy Portal. https://voxeu.org/article/simple-economics-tariff-russian-energy-imports

[20]. Trickett, N. (2022, July 1). Asia Can’t Save Russia’s Energy Sector. The Diplomat. https://thediplomat.com/2022/06/asia-cant-save-russias-energy-sector/

[21]. Statista. (2022, July 12). Urals oil price discount to Brent daily 2022. https://www.statista.com/statistics/1298092/urals-brent-price-difference-daily/#statisticContainer

[22]. BBC News. (2022c, July 21). Eurozone raises interest rates for first time in 11 years. https://www.bbc.com/news/business-62240730

[23]. Blanchard, O., & Pisani-Ferry, J. (2022). Fiscal support and monetary vigilance: economic policy implications of the Russia-Ukraine war for the European Union. Bruegel. http://www.jstor.org/stable/resrep41304

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