Before the war, the European Union bought roughly €200 billion of oil and roughly €200 billion of gas from Russia each year. That was the 2019 figure, and it was twice the foreign-exchange reserves the G7 countries held at the end of 2021. A new study from the Human Rights Institute uses numbers like that to measure what the Russia-Ukraine war has cost, in Europe and beyond.
The study’s author, an international relations scholar trained at Allameh Tabataba’i University, calls the conflict the most devastating in Europe since World War II. The United States and its NATO allies tried to keep it inside Ukraine’s borders through broad sanctions on Moscow and military support for Kyiv. The effects have gone much further, the study argues, changing diplomatic and economic ties, and pushing major powers to redirect resources and rethink where they invest.
Europe’s energy bill
Sanctions came from the US, European countries and several other states after the February 2022 invasion. Europe took the heaviest economic hit. The study notes that a halt to Russian gas would strip the EU of 40 percent of its gas supplies. Russia would lose more, though, because the EU draws only 8.4 percent of its total energy demand from Russia and has more room to switch suppliers than Russia has to find new buyers. The EU set a goal of bringing that share to zero by 2027.
Switching is not simple. Oil and coal can move without much infrastructure, but gas depends on pipelines and terminals, which narrows the options. Europe would have to either use less energy or turn to other sources, such as nuclear power and renewables, and build networks that can link a wider group of smaller suppliers.
The bill for cutting reliance on Russian imports in the short term reached €100 billion. According to the study, €50 billion of that went to rebuilding investment reserves, €25 billion to buying from alternative suppliers, and another €25 billion to coordinating distribution across the EU. Member states also used transfers, tax cuts and broad price controls to soften the shock, and changed how electricity is priced.
Inflation was already a problem. The COVID-19 pandemic had weakened trade conditions and pushed energy prices up, and the European Central Bank was working against rising prices before the war made them worse.
Ukraine’s slow recovery
Ukraine’s own numbers are weak. Its GDP grew by only 2.9 percent year on year in 2024, and the fourth quarter of that year fell 0.1 percent against the fourth quarter of 2023. In the first half of 2025, real GDP rose just 0.8 percent, with the second quarter at 0.7 percent year on year. The third quarter was better at 2.1 percent. For the first nine months of the year, growth came to 1.3 percent over the same period a year earlier.
Defense, debt and prices
War raises public debt, the study says, because governments borrow far more than usual when patriotic support runs high. Strategic reserves fall to the public sector, since private firms will not guarantee supply. EU members have put between 1 and 2 percent of GDP into defense budgets in the context of this war, and neighbors of a conflict tend to raise their own military spending.
Oil and gas prices climbed after the 2022 invasion, pushing up gasoline prices worldwide. Russia is a major producer of both, and the international restrictions on it have squeezed output. The author warns that shortages of goods and rising costs for oil push an economy toward cost-push inflation, and that hyperinflation can follow when a government prints money to pay for war. He says both Ukraine and Russia face such risks, since inflation is already visible in each.
A long conflict also drags down GDP, which in turn weakens healthcare and education. The study says the car and shipping industries are especially exposed to prolonged inflation from high commodity prices, which can invite stagflation and civil unrest.
