Since Russia’s illegal invasion of Ukraine in February 2022, EU lawmakers have adopted eight packages of sanctions against the Kremlin. The EU authorities endeavor to cripple Moscow’s ability to finance the war machine. At the same time, decent European taxpayers have to pay dearly for the EU’s new energy policy whose linchpin is a total ban on Russian petroleum products.
According to rough estimates, the boycott of Russian gas and the search for alternative gas suppliers have drained the European public purse by at least $1 trillion. The lion’s share of this amount has been spent to offset consumers’ and companies’ bills against soaring energy prices. Experts at Bloomberg say that the first consequences of the profound energy crisis are already taking a toll. Making such estimates, they refer to the data from Bruegel, a Brussels-based analytical think tank. Its analysts warn that the gas shortage might persist for many years ahead. Interestingly, the relief package adopted by the EU authorities to back struggling consumers has somehow mitigated the blow. Nevertheless, high inflation and elevated interest rates will exacerbate the negative impact in 2023.
Once the winter is over, the euro area will have to replenish its gas reserves virtually without Russian suppliers. Even provided that new facilities are built for LNG imports, the energy market will remain strained until 2026, Bloomberg predicts.
