Increasing Energy Prices Might Push 140 Million Individuals Into Absolute Poverty

According to a recent study, the rise in energy prices that has followed Russia’s war with Ukraine might force millions of people throughout the world into abject poverty.

In a collaborative effort between the United States, China, the United Kingdom, and the Netherlands, the journal Nature Energy assessed the impact of the war and found that energy prices have increased by 4.8% due to the rise in the cost of coal and natural gas, which is directly attributable to Russia’s invasion.

Low-income communities that previously faced challenges such as food insecurity are now at an even larger risk of falling into severe poverty, as nations such as Poland and the Czech Republic, whose economies are highly dependent on energy resources such as coal, face more hardships.

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In the United States, consumers spent 14.3 percent more on energy in 2018 than in 2021. The U.S. Bureau of Labor Statistics asserts that in the year ending in January, energy prices increased on their own by 11.9%.

As costs continue to climb, the report estimates that 141 million people worldwide are at risk of falling into extreme poverty.

“Costs of unaffordable energy and other essentials would force vulnerable populations into energy poverty and even extreme poverty. Knowing how global energy costs are conveyed to families through global supply chains and how they are affected is essential for designing effective and equitable policies,” the researchers wrote the paper.