Post
Topic
Board Economics
Re: The impact of Russian and Ukrain war on world economy
by
coupable
on 22/08/2022, 20:09:51 UTC
Due to war of Russia-Ukraine, there is shortage of gas supply and foods. After this, european countries agreed to reduce gas demand by 15% in end of this winter 2022.
The close connectivity between Russia and Europe economy cannot be disconnected even in a decade. Europe hyper-depends on Russia for oil and gas and Russia also depends on Europe for funds. Russia started preparing for this invasion long time ago and they know that Europe would be helpless for some years without them. The Russian economy has been fortified to withstand sanctions that's why Kremlin is not soft-paddling its invasion quests. Reducing gas demand would be a big challenge because the economic strength of the members of the European union are not the same. France, Germany or Spain can easily afford alternative source of power but what about less wealthy EU nations. Diversifying their energy source would be difficult because most of them cannot afford it. Hence, these nations would still have to depend on Russian less expensive oil and gas.The goal of reducing gas demand would be possible if richer EU nations would support others that are less prosperous to acquire alternative source of power.        
I wish you would explain to us what the countries you mentioned have alternatives for Russian gas. Especially Germany, which even if it wanted to acquire liquefied gas from America, it would take years to build liquefied gas conversion platforms.
The European Union helps member states if one of them needs a help-hand, as happened with Greece, but this will become almost impossible if all countries are suffering. The problem needs solutions from outside the union, and this is the role that America seems to be seeking to play.