While some of the war-led disruptions, such as the rise in commodity prices and inflation, have settled over the course of the year, others will likely have long-term ramifications.
By Samrat Sharma: The Russia-Ukraine war will soon be crossing the one-year mark. While some of the war-led disruptions, such as the rise in commodity prices and inflation, have settled over the course of the year, others will likely have long-term ramifications.
The prices of wheat, natural gas, crude oil, sunflower oil, and coal, among other commodities, skyrocketed as the war began. The turbulence remained for a few months but most of them settled down since.
Europe assessed its age-old dependence on Russian oil & gas
The rift with Russia gave Europe a window to reassess its dependence on Russian oil and gas. Russia cut piped natural gas exports to Europe by nearly half in 2022, bringing it down to the lowest level since the mid-1980s.
“The weaponisation of gas supply and the Russian Federation’s manipulation of the markets through intentional disruptions of gas flows have led not only to skyrocketing energy prices but also to endangering the security of supply,” the European Commission said.
A fast deployment of renewable energy sources can help to mitigate the effects of the current energy crisis, by forming a defence against Russia’s actions, it added.
Battling against the short-supplied and expensive natural gas, consumption was heavily cut in the European Union. It fell by an estimated 13 per cent in 2022 compared to 2021 – its steepest decline in history. Nevertheless, the storage of natural gas touched a record high of over 70 bcm (billion cubic metres) between April and mid-November in 2022, despite the steep decline in Russian piped gas.
Further, the European Union expedited its green energy transition under REPowerEU Plan 2022. The revised plan aims to save energy, diversify supplies, quickly substitute fossil fuels by accelerating Europe’s clean energy transition, and include investments and reform.
As the war began, a list of countries including the UK, the US, Japan, Canada, Norway, Switzerland, Poland, Australia, Finland, New Zealand, South Korea, Iceland, Germany, France, and Italy slapped sanctions on Russia.
As countries aligned themselves in three categories – with Russia, with Ukraine, and non-aligned – there were a few surprising developments. For example, while countries like Sweden and Finland have long resisted joining NATO, both aired their wish to join the Intergovernmental organisation once Russia invaded Ukraine. On the other hand, most countries in Asia remained non-aligned.
Rise in nuclear threats
While the world was mulling decreasing nuclear warheads, the Russia-Ukraine war once again put nuclear threats at the forefront. Media reports citing Ukrainian intelligence said that Russia has upgraded Russia’s strategic nuclear forces to the highest level of combat readiness as US President Joe Biden visited Ukraine.
In fact, even Biden has said that the risk of a nuclear attack was at the highest level since the 1962 Cuban Missile Crisis. This chain of events may deter countries from compromising their nuclear capabilities for a long time.
Russia’s image of a superpower
Not just Russia, but many global agencies had estimated that Russia would take on Ukraine within a month or so when the war started in February 2022. However, the war kept going on and is still being fought nearly a year later. While many parts of Ukraine have been reduced to rubble, Russia too has faced defeats, huge casualties, loss of equipment, and faced munitions shortages. This indicates how Russia underestimated Ukraine’s and overestimated its own military might.