The threats of war in Ukraine are already having economic consequences. The main indicator is oil. The fear of a war caused prices to soar: a barrel was trading at almost 100 dollars, a level not seen for eight years.
In fact, economic circles fear a drop in stocks because if a war breaks out, Russia risks lowering its production. And Russia, today, is the second oil exporter, the world’s third crude producer, behind the United States and Saudi Arabia.
If it reduces its supply, oil will become even rarer and therefore even more expensive. What further increase the bill for companies and permanently slow down the recovery especially since since the beginning of the year, it has already taken 20%. The most pessimistic experts speak of a possible oil shock. Especially since Vladimir Putin is not ready to open the floodgates. On the contrary, hydrocarbons are a very powerful means of pressure on the Europeans, the Germans, the French, and he plays on it.
It’s not just oil that’s worrying. This is also the case with gas. Here too, the Ukrainian crisis is driving up prices because Europe is very dependent on Russian gas and Gazprom. Four Russian gas pipelines cross Ukraine to supply Europe and in particular Germany. This also applies to wheat. Its price has soared by 30% in one year because Russia and Ukraine are major wheat producers. It is not for nothing that we speak of Ukraine as the breadbasket of Europe. The price of wheat which increases, it is our flour, our pasta, our baguette which cost more.
This Ukrainian crisis is causing the beginnings of panic on the financial markets. Monday February 14 was tense on the Paris Stock Exchange. It has unscrewed, by more than 2%. All European stock markets also ended in the red. Already on Friday, Wall Street and the markets were panicking and there is little chance that today, things will improve, that investors will regain confidence, while the United States is talking about an upcoming attack from Ukraine.