New world crisis looming on horizon
Many reputable analysts are voicing concerns about dismal economic prospects. They say that humanity should be bracing for a new world crisis. The main economic woes are mainly associated with coronavirus. However, the ongoing energy crisis and forecasts for the cold winter season are also weighing on market sentiment.
Therefore, some market strategists warn of a global crisis this winter given the new wave of coronavirus, a record increase in the cost of energy, and a shortage of goods caused by disrupted supply chains. Apparently, misfortunes never come alone. According to some long-term weather forecasts, the upcoming winter is expected to be quite cold. This is why analysts as never before monitor the temperature in the northern hemisphere. If pessimistic weather forecasts turn out to be correct, the shortage of energy resources may trigger a full-scale crisis.
Bloomberg analyst Michael Winfrey assumes that countries will have to compete with each other for energy resources, primarily gas and coal. It is already happening, he notes. For example, China has ordered to increase coal supplies above quotas, unleashing a record rise in gas and electricity prices in Europe. In the meantime, the energy crisis in Europe threatens to disrupt the food supply. Due to the headwinds in the energy market, in the Netherlands, the largest greenhouse industry has already closed. The worst is yet to come, Winfrey believes. For instance, wheat stocks are declining worldwide. Forecasts for grain production are only getting worse.
Apart from that, old problems do not go away. In September, the Guardian released a gloomy report. "For every tonne of carbon dioxide emitted, the global economy would be $3,000 worse off by the end of the century", they estimated. The research conducted by experts from Cambridge University, University College London and Imperial College London, as well as international partners from Switzerland, Germany, the US, and Austria revealed that the economic cost of the climate crisis amounted to about 37% of global GDP this century.