Could Russia-NATO War Cost The World Trillions?

A full-scale war between Russia and NATO, once considered unlikely, is now a growing concern among European officials as Vladimir Putin accelerates Russia’s military production and signals broader ambitions beyond Ukraine. Bloomberg Economics estimates that such a conflict would slash global GDP by $1.5 trillion in the first year alone, with the Baltic states facing economic devastation of up to 43% and the European Union as a whole losing about 1.2% of its output. While Russia’s economy would contract by just 1%—insulated by sanctions and boosted by wartime spending—major economies like the US and China would also suffer significant losses due to market turmoil and soaring energy prices.

Despite the dire economic outlook, European intelligence currently sees no concrete evidence that Russia plans to attack NATO territory imminently, though Moscow is rebuilding its forces at a pace far exceeding that of the West. NATO leaders are responding by boosting defense spending and preparing for worst-case scenarios, even as some hope for a diplomatic resolution involving the US, Europe, and China. The risk of escalation remains high, especially if the US response is delayed, and the consequences would extend far beyond immediate military losses, triggering refugee crises, infrastructure collapse, and long-term instability across the continent.

Source: Bloomberg