Russian gas halt looms large over Italian economy

(EurActiv, 30 May 2022) While bickering over the Russian oil embargo exposed EU divisions ahead of bloc leaders’ meeting in Brussels on Monday, Italian industry warns that a gas cut could prove devastating for the country’s economy.

If Italy stops Russian gas purchases in June, its GDP could suffer a 2% drop, a report published on Saturday by Confindustria, the association representing Italian industries, estimated.

According to the report, the Ukraine war is making growth forecasts for “the second quarter of 2022” complex for Italy.

A “possible shutdown of natural gas imports from Russia could hit the Italian economy,” according to the experts who say the pandemic has already weakened the financial system.

The analysis, which used 2021 monthly gas consumption as a baseline for calculations, projected a 2% drop in GDP if gas imports from Russia halted in June, even if alternative sources of supply became gradually available by next winter based on the various agreements and projects that Italy has already started.

“Such a strong effect would cause a major shortage of gas volumes for industry and services and an additional increase in energy costs,” the Confindustria report added.

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EurActiv, 30 May 2022: Russian gas halt looms large over Italian economy