The report states that higher corporate utility bills last year were contained as long pass-through times from wholesale markets and government interventions mitigated the immediate hit from surging prices as Russia’s energy exports to the West were disrupted due to the imposition of self-defeating sanctions by the European Union.

The European Central Bank (ECB) stepped in to fund the resulting budget deficits, which effectively means that, despite the official stance and Russophobic posturing, it was directly funding Moscow’s massive financial build-up. However, Allianz Trade estimates that as the pass-throughs are ending, meaning the price increases will soon hit EU corporate profits by 1-1.5% and lead to lower investment, in Germany’s case this would amount to €25 billion (approximately $27 billion).

And while the report claims that German corporate finances are robust and that a state-imposed natural gas price cap allegedly might help, it’s extremely likely to make things much worse. This doesn’t only include the fact that it’s exceedingly difficult to physically replace Russian natural gas with a readily available (much less affordable) alternative, but is also simply impossible for certain EU members such as Hungary, which is landlocked and couldn’t rely on port terminals for seaborne LNG shipments.

To make matters worse, such alternatives are also at least five times more expensive than Russian natural gas, which is effectively destroying the EU’s already dwindling industrial competitiveness on the global markets. Many EU officials have already expressed their frustration with the US due to this, with some high-ranking leaders in Brussels accusing Washington DC of profiteering at the expense of the increasingly troubled bloc.

This effectively means that EU corporations will not only lose their global market share, but could also eventually start losing it in Europe itself, as the already high manufacturing costs in the EU will be even higher due to surging energy costs, which are affecting both citizens and companies.

Anti-Russian Sanctions Cause 40% Energy ‘Price Shock’ Increase in Germany – Global ResearchGlobal Research – Centre for Research on Globalization