This backgrounder explains the significance and risks of the Russian invasion of Ukraine. See each question and answer included in this backgrounder on the Russian invasion of Ukraine at the bottom of this post.

Could This Produce A Food and Energy Crisis?

The food crisis started some time ago, and many parts of the world, including Europe, were already experiencing significant energy crunches. Russia’s invasion of Ukraine is only accelerating these crises.

For months the World Food Program has warned of increasing population counts in areas like Madagascar and Yemen that face starvation and famine due to broken food supply chains and ongoing war. The pandemic accelerated these crises around the globe, putting the world’s nations at the highest risk on the frontlines of the 21st century’s greatest food crisis.

Many commentators saw the 2011 Arab Spring in North Africa and the Middle East as a popular uprising for democracy. As I discussed in my book How the World Ends, it was much more about the price of bread than the right to vote. Today many of those same nations are seeing runaway prices in the price of grains.

According to the International Monetary Fund, the price of grain increased 80% between April 2020 and December 2021. North Africa and the Middle East are largely dependent upon grain from Russia and Ukraine to meet their already plummeting supplies and increasing population demands. Frequently referred to as ‘the breadbasket of Europe, ’ Ukraine supplies 12% of the world’s grains. Much of that goes to this area of the world where there is little margin for error in these supply chains. Here the price of food is rising far faster than anywhere else in the world.

Egypt is the world’s top importer of wheat and already looking for an alternative supplier in the wake of Russia’s invasion. Morocco has seen the price of food skyrocket in the wake of its worst drought in three decades. Tunisia could not pay for its current food needs before the war. All of these situations have only worsened since the invasion of Ukraine began last week. In Lebanon, a nation teetering on the verge of failed state status, the country has enough wheat reserves for one month. Sixty percent of Lebanon’s wheat market is dependent upon supplies from Ukraine.

On the energy front, Europe relies heavily on gas supplies from Russia, and nearly one-third of those supplies flow through Ukraine. Russia is the world’s second-largest natural gas exporter and third-largest petroleum producer. As these exports become strained, prices will increase across the globe. As the price of energy rises, the price of everything else rises.

Last week, on the first day of Russia’s invasion of the Ukraine benchmark Dutch gas futures rose 62%. German power for March rose 58%. Coal and gas also surged. It is worth noting that the international sanctions against Russia have not touched the energy sector so far. Some argue this allows Russia to refill the nation’s coffers through higher energy prices. If the western world imposes sanctions on Russia’s energy sectors, we will see an even greater surge in prices globally.

 

Learn more about the background and facts behind the Russian invasion of Ukraine through this set of backgrounds and explanations. Subscribe to the blog to stay up to date when new backgrounders are posted.

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JB Shreve is the author of "How the World Ends: Understanding the Growing Chaos." He has been the host of the End of History podcast since 2012. He has degrees in International Relations and Middle East Studies. His other books include the Intelligence Brief Series. Regular posts and updates from JB Shreve are available at www.theendofhistory.net