Cayman Islands, Caribbeanand International News
Monday, Oct 02, 2023

Germany faces $240 billion hit if Russian gas is cut off

Germany faces $240 billion hit if Russian gas is cut off

Germany would plunge into a deep recession if its supply of Russian natural gas was suddenly shut off, the country's top forecasters warned on Wednesday.

The country would lose 220 billion euros ($238 billion) in economic output over the next two years in the event of such a shock, according to a report by five German economic institutes. German GDP would rise by just 1.9% in 2022, and contract by 2.2% in 2023. Growth would be 2.7% this year if the gas keeps flowing.

Cutting Russian gas would push Europe's largest economy into a "sharp recession," said Stefan Kooths, research director at the Kiel Institute for the World Economy and one of the report's authors.

Revelations of atrocities committed in Bucha while the suburb of Kiev was under control of Russian forces prompted the European Union to escalate economic sanctions against Moscow and go after Russia's vast energy exports for the first time since it invaded Ukraine.

EU leaders agreed to phase out all Russian coal imports. An EU source told CNN Business that coal would be banned by August. A new, sixth round of sanctions is already being discussed, and some EU officials have called for action on Russian oil and gas exports.

But a ban on Russian gas in the near term would wreak havoc on Germany, which relied on Russia for about 46% of its natural gas in 2020, according to the International Energy Agency. It uses the fuel to heat homes, generate electricity and help power its factories.

The European Union is already trying to slash imports of Russian gas by 66% this year, and break its dependence entirely on Russian energy by 2027.

Last week, Germany's Finance Minister Christian Lindner said the country was moving "as quickly as possible" to ditch Russian energy, but poured cold water on a sudden stop.

"The question is, at what point do we do more harm to Putin than to ourselves?" Lindner said in an interview with newspaper Die Zeit.

"If I could only follow my heart, there would be an immediate embargo on everything. However, it is doubtful that this would stop the war machine in the short term," he added.

Targeting Russian gas supplies would likely worsen inflation in Germany which hit its highest level in more than 40 years last month. Consumer prices rose 7.3% from the year before, data from the country's Federal Statistics Office showed.

The main culprit: Soaring prices for natural gas and oil, which rose by nearly 40% over the same period.

BDEW, an association of German energy and utility suppliers, said last week that it was "ready to work out a detailed plan" to phase out Russian gas quickly, but urged politicians to proceed with caution.

"After all, [cutting Russian gas] is about nothing less than the transformation of the entire German industry," Marie-Luise Wolff, BDEW's president said in a statement.


Related Articles

Paper straws found to contain long-lasting and potentially toxic chemicals - study
FTX's Bankman-Fried headed for jail after judge revokes bail
Blackrock gets half a trillion dollar deal to rebuild Ukraine
Israel: Unprecedented Civil Disobedience Looms as IDF Reservists Protest Judiciary Reform
America's First New Nuclear Reactor in Nearly Seven Years Begins Operations
Southeast Asia moves closer to economic unity with new regional payments system
Today Hunter Biden’s best friend and business associate, Devon Archer, testified that Joe Biden met in Georgetown with Russian Moscow Mayor's Wife Yelena Baturina who later paid Hunter Biden $3.5 million in so called “consulting fees”
Singapore Carries Out First Execution of a Woman in Two Decades Amid Capital Punishment Debate
Google testing journalism AI. We are doing it already 2 years, and without Google biased propoganda and manipulated censorship
Unlike illegal imigrants coming by boats - US Citizens Will Need Visa To Travel To Europe in 2024
Musk announces Twitter name and logo change to X.com
The politician and the journalist lost control and started fighting on live broadcast.
The future of sports
Unveiling the Black Hole: The Mysterious Fate of EU's Aid to Ukraine
Farewell to a Music Titan: Tony Bennett, Renowned Jazz and Pop Vocalist, Passes Away at 96
Alarming Behavior Among Florida's Sharks Raises Concerns Over Possible Cocaine Exposure
Transgender Exclusion in Miss Italy Stirs Controversy Amidst Changing Global Beauty Pageant Landscape
Joe Biden admitted, in his own words, that he delivered what he promised in exchange for the $10 million bribe he received from the Ukraine Oil Company.
TikTok Takes On Spotify And Apple, Launches Own Music Service
Global Trend: Using Anti-Fake News Laws as Censorship Tools - A Deep Dive into Tunisia's Scenario
Arresting Putin During South African Visit Would Equate to War Declaration, Asserts President Ramaphosa
Hacktivist Collective Anonymous Launches 'Project Disclosure' to Unearth Information on UFOs and ETIs
Typo sends millions of US military emails to Russian ally Mali
Server Arrested For Theft After Refusing To Pay A Table's $100 Restaurant Bill When They Dined & Dashed
The Changing Face of Europe: How Mass Migration is Reshaping the Political Landscape
China Urges EU to Clarify Strategic Partnership Amid Trade Tensions
Europe is boiling: Extreme Weather Conditions Prevail Across the Continent
The Last Pour: Anchor Brewing, America's Pioneer Craft Brewer, Closes After 127 Years
Democracy not: EU's Digital Commissioner Considers Shutting Down Social Media Platforms Amid Social Unrest
Sarah Silverman and Renowned Authors Lodge Copyright Infringement Case Against OpenAI and Meta
Italian Court's Controversial Ruling on Sexual Harassment Ignites Uproar
Why Do Tech Executives Support Kennedy Jr.?
The New York Times Announces Closure of its Sports Section in Favor of The Athletic
BBC Anchor Huw Edwards Hospitalized Amid Child Sex Abuse Allegations, Family Confirms
Florida Attorney General requests Meta CEO's testimony on company's platforms' alleged facilitation of illicit activities
The Distorted Mirror of actual approval ratings: Examining the True Threat to Democracy Beyond the Persona of Putin
40,000 child slaves in Congo are forced to work in cobalt mines so we can drive electric cars.
BBC Personalities Rebuke Accusations Amidst Scandal Involving Teen Exploitation
A Swift Disappointment: Why Is Taylor Swift Bypassing Canada on Her Global Tour?
Historic Moment: Edgars Rinkevics, EU's First Openly Gay Head of State, Takes Office as Latvia's President
Bye bye democracy, human rights, freedom: French Cops Can Now Secretly Activate Phone Cameras, Microphones And GPS To Spy On Citizens
The Poor Man With Money, Mark Zuckerberg, Unveils Twitter Replica with Heavy-Handed Censorship: A New Low in Innovation?
Unilever Plummets in a $2.5 Billion Free Fall, to begin with: A Reckoning for Misuse of Corporate Power Against National Interest
Beyond the Blame Game: The Need for Nuanced Perspectives on America's Complex Reality
Twitter Targets Meta: A Tangle of Trade Secrets and Copycat Culture
The Double-Edged Sword of AI: AI is linked to layoffs in industry that created it
US Sanctions on China's Chip Industry Backfire, Prompting Self-Inflicted Blowback
Meta Copy Twitter with New App, Threads
The New French Revolution
BlackRock Bitcoin ETF Application Refiled, Naming Coinbase as ‘Surveillance-Sharing’ Partner