The report examines the potential economic impact of this energy crisis, including implications if there were a full stoppage of Russian gas. At this juncture, Europe appears poised to be more resilient than many realise; however, the outlook is highly uncertain, and outcomes will depend on whether Europe can smoothly adjust to the energy shock.
Key takeaways
Addressing a complete shutdown of Russian gas requires significant infrastructure changes and Europe-wide coordination to support the most vulnerable countries, such as Germany and Italy. Reducing reliance on Russian gas is within the realm of possibility, but challenges still exist in the short to medium term.
KBRA conducted rough estimates on how a full stoppage of Russian gas could affect several European GDPs. This impact could range from as little as -0.1% in France to as much as -2.8% in Germany under a crisis scenario.
The industrial sector would be most heavily impacted by losing gas supply, with the risk of large job losses in certain sectors, although this could be somewhat mitigated by government support.
