Curious about where the War in Ukraine is heading? Will Western support make a difference? And what impact will the major expected upcoming shift in the war mean for Europe come this summer?

While it appears the war has hit a stalemate, that is far from the case. Both sides have been reconstituting their forces while fighting has slowed but persisted in advance of a likely upcoming major Russian offensive in the coming weeks. Ukraine is likewise preparing itself for a major offensive, though Western tanks and armored vehicles will not arrive until later in March. Ultimately, our base case expectation is that both sides will exhaust themselves by the summer after several major battles and Ukraine is likely to recapture some more land, though far from a victory, and establish a new line of contact deeper into Russian-held territory. Under such a scenario, ceasefire talks could potentially begin, though real settlement to the war will be possible and the war drags on throughout the rest of the year.

Related to Europe, this long war scenario and the continued sanctions will continue to keep up energy and food prices, weighing on growth this year. The warm and windy winter helped forestall a more severe energy crisis, gas prices will remain high all year and shortages could occur next winter in a downside scenario. Key markets like Germany and the UK are likely to face recessions this year, while most other major markets will stagnate or otherwise enjoy minimal growth.

If you are wondering about these questions and more, request the brief video below where Mark McNamee, Director of Europe, and Martin Belchev, Associate Practice Leader for Europe, have a quick informal discussion related to the upcoming offensives, where this leads to, and the broader impact on the European economy.

Download our video to hear an update on the war in Ukraine

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