A complete disruption in gas supplies from Russia to Europe would have a devastating impact on countries in eastern and central Europe, whose gross domestic product (GDP) could fall by around 6%, according to a report published on Tuesday by the International Monetary Fund (IMF) Fair (19).
In Germany, the most important economic engine of the European Union, a full cut would reduce GDP by around 3%. In the case of Spain, which is much less dependent on gas from Russia, the effect would be much more limited and the drop in GDP would be around 1%, as in France.
The countries whose economies would suffer the most from a total lockdown by Russia an increasingly speculated option would be, in that order, Hungary, Slovakia, the Czech Republic, Italy, Germany, Austria, Romania, Slovenia, Croatia, Poland and the Netherlands.
Of these, the first four (Hungary, Slovakia, Czech Republic and Italy) would see an activity drop of around 6% of GDP. All but Italy are at risk of supplies falling by as much as 40% if Russia cuts gas, according to the IMF.
“These impacts could be mitigated by finding alternative sources of supply, alleviating infrastructure bottlenecks, promoting energy savings and strengthening solidarity agreements between countries to share gas,” the report said.
Russian gas covers 40% of gas needs in Europe, which has so far decided not to refuse fuel purchases from Russia, which in turn has already suspended all or part of supplies to 12 countries.
In recent months, supplies to Europe via Ukraine have fallen by almost 30%, and those from the Nord Stream pipeline, which transports Russian gas to Germany just under the Baltic Sea, by 60%.
Nord Stream is currently on a technical standstill for “scheduled maintenance” and its feasibility is uncertain due to problems in overhauling the turbines that Russia has encountered due to Western sanctions, according to Russian stateowned Gazprom.