The global economy is poised to be sent on another unpredictable course by an armed clash of Europe's border after getting battered by the Pandemic.
The lead-up to a potential Russian invasion has taken a toll. The promise of punishing sanctions in return by President Biden has pushed down stock returns and driven up gas prices.
An attack by Russian troops could cause spikes in energy and food prices, fuel inflation fears, and cause investors to flee the world, a combination that threatens investment and growth in economies around the world.
The immediate impact will not be as devastating as the economic shutdowns caused by the coronaviruses in 2020. Russia has 146 million people and a huge nuclear arsenal, as well as being a key supplier of the oil, gas and raw materials that keep the world's factories running. Russia is a small player in the global economy compared to China.
Italy has an economy that is twice the size. Poland exports more goods to the EU than Russia.
Russia is unimportant in the global economy except for oil and gas, according to a Harvard economist.
Those who depend on a gas station closing can be hard hit. The result is that any economic damage will be unevenly spread, intense in some countries and unnoticed in others.
Europe gets 40% of its natural gas and 25% of its oil from Russia, and is likely to be walloped with spikes in heating and gas bills, which are already soaring. European leaders have accused Russia of reducing supplies to gain a political edge, as natural gas reserves are at less than a third of capacity, with weeks of cold weather ahead.
According to a recent United Nations report, food prices have risen to their highest level in more than a decade because of the Pandemic. Russia is the world's largest supplier of wheat and accounts for 25% of global exports. The dependence is much greater for some countries. Egypt and Turkey import more than 70 percent of their total wheat imports from that flow of grain.
Turkey is in the middle of an economic crisis and is struggling with inflation that is running close to 50 percent, with food, fuel and electricity prices.
Ian Goldin, a professor of globalization and development at Oxford University, said that poor people spend a higher share of their incomes on food and heating.
More than 40 percent of the wheat and corn that Ukraine exports to the Middle East or Africa is worried about social unrest, which is why the country is known as the breadbasket of Europe.
Lebanon, which is experiencing one of the most devastating economic crises in more than a century, gets more than half of its wheat from Ukraine.
The world's largest exporter of seed oils is Ukraine.
There are a range of scenarios from mild to severe. If Russian troops stay near the border or attack the Ukrainian capital, Kyiv, it will affect the lives of working-class families and Wall Street traders.
Julia Friedlander is the director of the economic statecraft initiative at the Atlantic Council.
Minor disruptions in one region can cause major disruptions far away. In a world still struggling to recover from the Pandemic, isolated shortages and price spikes can snowball.
Gregory Daco, chief economist for EY-Parthenon, said that there was high inflation, strained supply chains and uncertainty about what central banks would do.
The economies that are still recovering from the economic body blows of the Pandemic are piling on the additional stresses.
Mr. Daco said that political uncertainty and volatility weigh on economic activity.
That means an invasion could have a negative effect on the economy.
In the United States, the Federal Reserve is facing the highest inflation in 40 years, and is expected to raise interest rates next month. Higher energy prices set off by a conflict in Europe could feed worries about a wage-price spiral.
Christopher Miller is a visiting fellow at the American enterprise institute and an assistant professor at the university.
Also fueling inflation fears are possible shortages of essential metals like palladium, aluminum and nickel, creating another disruption to global supply chains already suffering from the Pandemic and trucker blockades in Canada.
The price of palladium, used in automotive exhaust systems, mobile phones and even dental filling, has gone up in recent weeks because of fears that Russia could be cut off from global markets. The price of nickel, used to make steel and electric car batteries, has gone up.
The impact of an armed conflict is too early to gauge, said the chief technology officer of Volvo. He said that it is a very serious thing.
We have a number of scenarios on the table and we are following the developments of the situation day by day.
If Mr. Putin retaliates, the West has taken steps to protect Europe. The United States has increased delivery of natural gas and asked other suppliers to do the same.
The demand for oil could help revive a deal to curb Iran's nuclear program. Iran has been locked out of most of the world's markets since President Donald J. Trump withdrew from the nuclear accord and reimposed sanctions.
If the Biden administration were to cut off access to the system of international payments known as SWIFT or block companies from selling anything to Russia that contains American-made components, it would hurt anyone who does business with Russia. The United States is less vulnerable than the European Union.
Mr. Biden has warned that Americans are likely to see higher gasoline prices. The price increases for natural gas in the United States are not as steep as in other countries. Europe engages in more financial transactions with Russia, including paying for the Russian gas.
Oil companies like Shell and Total have joint ventures in Russia, while BP is one of the biggest foreign investors in Europe. Russia supplies titanium to the European aviation giant. Billions of dollars have been lent by European banks to Russian borrowers.
Adam Tooze, director of the European Institute at Columbia University, said that severe sanctions that hurt Russia have the potential to do huge damage to European customers.
The most significant effects on the global economy can only be seen over the long run.
Pushing Russia to have closer economic ties with China would be a result. Russia and China recently signed a 30-year contract for Russia to supply gas to China.
Carl Weinberg, chief economist at High Frequency Economics, said that Russia is likely to pivot all energy and commodity exports to China.
The global economy is being reexamined due to the crisis and concerns about self-sufficiency. Lean production has been highlighted as a downside of far-flung supply chains.
Europe's dependence on Russian gas is spurring discussions about expanding energy sources, which could further sideline Russia in the global economy.
Jeffrey Schott is a senior fellow working on international trade policy at the Peterson Institute for International Economics. Russia's real cost would be corrosive over time and make it difficult to do business with Russian entities and deter investment.
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