War in Ukraine is causing food and fuel crises
The graph shows the impact of war in Ukraine on global trade. Now i am described about it.
Because of uncertainty over the course of the Ukraine conflict and lack of hard data on its economic impact, WTO economists have used simulations to make “reasonable assumptions” about trade. In chart 1, they explain that growth of world merchandise trade volumes in 2022 “could be as low as 0.5% or as high as 5.5%”.
Different margins of error are shown in the chart as coloured bands.
The projections will be updated in October, or earlier if new data comes in.
In a crisis, the WTO says more trade is needed – not less – so everyone can get essential supplies. It is calling on governments and partner organizations to work together to facilitate trade.
Chart 2 shows how world fuel prices have been rising rapidly. This started in 2020, before the war in Ukraine. In March 2022, a barrel of oil was $118 – 38% higher than in January 2022 and 81% up on the same time last year. Daily oil prices reached a high of $128 per barrel on 8 March, but had fallen to $104 per barrel by 1 April.
Prices for natural gas vary across regions, the WTO explains. Europe saw natural gas prices climb 45% between January and March to $41 per million British thermal units (Btu) – a measure of heat content. In the United States, on the other hand, prices have “remained relatively low,” the WTO says, at around $4.9 per million Btu.
“Higher oil prices may reduce real incomes and import demand worldwide, while higher natural gas prices would probably have a greater impact in Europe,” the WTO says.