The ongoing conflict between Russia and Ukraine has created many tensions throughout the world; especially in Europe. Many people are worried about the war worsening. They are overlooking an additional problem: an economic crisis.

 The war has affected the economies of many countries and industries, including merchandise imports and exports, crude oil, natural gas, and transportation. This affects a large number of people in Europe in different ways—for some people it could be an inconvenience, but for others, it could create an extremely poor quality of life. Crude oil prices went up 81%, and the price of one barrel went up to $128 from $104.

The rising price of crude oil affects other industries such as travel and heating. Although traveling is important, one can live without it. On the other hand, heating is required in some parts of the world, especially Eastern Europe. Temperatures can go as low as -8 degrees Fahrenheit, so heating is mandatory in these areas. Since heating companies have to make a profit, they are raising the prices to compensate for the rising crude oil prices. Many people could barely afford to pay the price before the war, which was lower and can no longer afford heating services. The price of natural gas went up 45% and is $45 million dollars per British Thermal Unit (BTU). 

Merchandise imports and exports are decreasing in many countries throughout the world. Europe is struggling to export more goods because the war has significantly increased shipping costs. This is affecting countries in Africa because they are unable to import more goods because of the decline in trade. Due to Africa’s location, it doesn’t have access to many goods that other continents do. Some of these goods are machinery, biopharmaceuticals, and automotives. The only region to benefit from these economic problems is the Middle East. The increase in crude oil prices increases the profit they make, which has allowed them to import more goods.

Now more than ever do we wish for the Russia and Ukraine conflict to conclude. These economical issues will eventually affect the United States if the war continues. These economic problems could get exponentially worse if the conflict escalates. Crude oil prices, merchandise prices, automotive prices, and many other industries will increase in price. 

Bibliography

“These 3 Charts Show the Impact of War in Ukraine on Global Trade.” World Economic Forum, https://www.weforum.org/agenda/2022/04/ukraine-war-global-trade-risk/.