Currently, the Russian invasion of Ukraine generates a lot of confusion worldwide because it is uncertain how this war will impact the economy of countries such as the United States or any other country in the rest of the world.
When the world was beginning to recuperate a little after the impact generated by the Covid-19 pandemic, now we find ourselves with this new situation that worries many of us.
In today’s post, we will talk about the consequences that the Russian invasion of Ukraine could have on the U.S. economy.
The U.S. economy will suffer the consequences of the war
- Energy prices are increasing
The United States is a country that still imports energy from other countries, however, can produce its gas and oil and depends less on Russia, because it imports only 7.9% of its oil from that country, according to the EIA.
If Russia suspends supplies to the U.S., energy prices are likely to rise.
- Higher inflation
As the prices of energy and other raw materials that Russia produces, such as aluminum and nickel, increase, the inflation rate in the United States would rise.
This cannot be determined exactly, because the effects of the Russian invasion of Ukraine remain highly uncertain for the U.S. economy.
- Problems in supply chains
As well, rising prices are also the result of problems in supply chains.
The prices the U.S. pays to import goods, by air and sea, would increase.
One of the reasons behind this problem is that Russia has closed its airspace to more than 35 countries, which means that any cargo aircraft passing through Russian skies will have to find another route.
This will mean that more fuel will have to be spent to fly. Important shipping container companies, such as Maersk, have announced the temporary suspension of shipping to Russia.
They have this note on the website: “Information about bookings made to and from Ukraine and Russia Maersk has suspended bookings to/from both Russia and Ukraine until further notice. Exempted from the booking suspension to/from Russia is foodstuffs, medical and humanitarian supplies. Please visit our customer advisory page for more information.”
Long-term effects of the Russian invasion of Ukraine
Numerous experts worldwide continue analyzing the context of this whole Russian-Ukrainian war.
And their biggest question is if all that is happening, including the sanctions, are going to have a long-lasting negative impact on the United States. Leading economists, such as Hung Tran, believe that the effect of the Russian invasion of Ukraine on the U.S. will be temporary and will not affect the U.S. as much as many people think.
This is because Russia is an energy-exporting country, however, this only constitutes 1.7% of the world’s production.
Hung also comments that the effects will be more severe for Europe, since, the European economy is interconnected with the Russian economy, they are commercial partners.
The United States has a strong economy
Although the United States is a major world economic force, the conflicts brought by the war between Russia and Ukraine will impact its economy in some way.
We do not know what the real impact of the measures will be, we do not know if the banks will remain solvent if the payment systems will be able to function, or even if the import and export of products and raw materials will be affected.
It is too early for global economic experts to determine what is going to be the real effect on supply and demand and the U.S. economy.
So far, any opinion is just a hypothesis that can only be tested in the course of the next few days as we see the effects of this war between Russia and Ukraine.
However, it is certain and can be seen right now, the huge social and economic negative effects that the Ukrainians are suffering at this moment.
A war between countries will never leave positive consequences.
Death, pain, material, and physical losses are the worst consequences that Russia’s invasion of Ukraine will leave.
These are facts that invite us to reflect on the true meaning of our lives.
In the next posts, we will continue exploring topics related to the Russian invasion of Ukraine and discussing this topic that will leave a negative mark in the history of the world.
By Mónica Chacín
About the Author:
Mónica Chacín, SEO Copywriting specialist and author of a
book of reflections and poetry known as “Serendipia de sueños”