Economy News – Follow-up
The North Atlantic Treaty Organization (NATO) is set to initiate a significant infrastructure project involving the construction of a pipeline system connecting Germany to Poland and the Czech Republic. This measure is aimed at ensuring a swift and reliable supply of fuel for combat aircraft in the event of hostilities with Russia.
The existing pipeline network, which was established during the Cold War, currently terminates in western Germany, presenting logistical challenges for rapid military mobilization.
Internal communications from the German military highlight concerns over “major problems in the continuous fuel supplies of the forces that may need to be deployed on the eastern border in the event of an emergency.”
The projected cost for this pipeline initiative is estimated at 21 billion euros (approximately 22 billion dollars), with the majority of the infrastructure expected to be operational by 2035.
Europe’s energy landscape is currently in a precarious state, exacerbated by a dramatic reduction in Russian gas supplies, which cater to over 80% of the continent’s heating, industrial, and electricity generation needs, according to the International Monetary Fund.
Wholesale electricity and gas prices have surged by nearly 15 times since early 2021, resulting in substantial financial strain on households and businesses alike.
The situation is expected to deteriorate further as Europe braces for its first winter without Russian gas, raising the specter of escalating prices, potential gas shortages, and a substantial economic downturn.
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