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TYPE
Original Research
PAGE NO.
11-21
DOI
OPEN ACCESS
SUBMITED
19 October 2024
ACCEPTED
13 December 2024
PUBLISHED
06 January 2025
VOLUME
Vol.05 Issue01 2025
COPYRIGHT
© 2025 Original content from this work may be used under the terms
of the creative commons attributes 4.0 License.
The Russian-Ukrainian War
and Its Economic Impact
on The Middle East
Ibtisam Kadhim Jassim
Al-Furat Al-Awsat Technical University, Najaf Technical Institute, Iraq
Abstract:
The conflict between Russia and Ukraine has
had a substantial impact on the stability of the world
economy, particularly in the Middle East. This study
examines the conflict's complex economic effects on the
area, with a particular emphasis on trade dynamics,
food security, and energy markets. The war's disruption
of global supply lines and subsequent changes in gas and
oil prices impacted both Middle Eastern nations that
import and sell oil.
Disruptions in grain shipments from Russia and Ukraine
also presented significant difficulties for the area,
increasing food shortages and putting pressure on the
economies of import-dependent countries. The paper
examines the ways in which Middle Eastern countries
responded to these shocks, emphasizing policy
initiatives including broadening strategic reserves,
boosting domestic output, and diversifying trading
partners.
Keywords:
Trade dynamics, food security, and energy
markets.
Introduction:
On February 24, 2022, Russia’s President
Vladimir Putin ordered an invasion of Ukraine, marking
the beginning of a full-scale military conflict between
the two countries. This war, already lengthy and
complicated, has become the focus of international
attention due to its significant geopolitical ramifications.
Countries worldwide have been affected by this war's
political and economic repercussions, particularly in the
Middle East. Russia is the world’s second
-largest oil
producer and the third-largest oil exporter. Ukraine may
not hold as much significance as Russia in energy
markets, but it is still critical, accounting for 16 percent
of global grain exports and over 40 percent of the
world’s sunflower oil exports (Thanh Ha, 2023). The
interconnectedness of the global economy has
exacerbated the war's effects beyond Europe. The
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Middle East has experienced significant economic
repercussions from the Russian-Ukrainian war,
particularly concerning changing energy prices, food
security, and political unrest. This text aims to address
the Russian-Ukrainian war and its substantial
economic impacts on the Middle East. To attain this
objective, the text will examine the war’s military,
political, and economic dimensions. These three
aspects will be explored sequentially, detailing the
current state of the war and possible future scenarios.
The military aspect will be analyzed first, focusing on
technological changes in warfare and their implications
for the Middle Eastern countries. Following that, the
political dimension will be discussed, highlighting the
current shifting alliances and international relations
framework and their impacts on the Middle East.
Finally, the economic aspect will be examined,
analyzing changing energy prices and food security
issues. Understanding the discussed aspects is crucial
for comprehending the broader implications of the war
from the perspective of Middle Eastern countries. The
relevance and urgency of the topic must be
emphasized. The world has entered a new phase of
international relations, as evidenced by the ongoing
Russian-Ukrainian war. Many issues that appeared to
have been resolved in the post-Cold War era re-
emerged, necessitating a comprehensive look at the
war's multi-faceted impacts. The recent conflict
illustrates how a single event can have far-reaching
effects,
particularly
in
an
era
of
global
interdependence.
Historical Background
With the end of the Cold War, that was the time of the
triumph of the Western model, for the first time in the
post-war period, a game in which only a single player
owned the board. For Moscow, this meant the loss of
the status of the superpower. On the contrary, for
Ukraine, it was the beginning of statehood but against
the background of the disintegration of the Soviet
empire (Pigliucci, 2018). The newly independent
Republic of Ukraine found itself in the most difficult
geopolitical situation. On the one hand, there was
Europe, which proposed the integration of the post-
Soviet states into its orbit but was not ready to take on
the associated risks. On the other hand, there was
Russia, which considered the loss of control over the
post-Soviet space to be its geopolitical catastrophe and
tried to restore its influence, which it saw primarily in
the political, military, and economic spheres. In such a
difficult situation, Ukraine tried to maneuver between
the West and the East. The first president of Ukraine,
Leonid Kravchuk, tried to play both sides, declaring
Ukraine’s course towards independence, non
-nuclear
status, and a neutral approach to military alliances.
However, by refusing the Status of the bloc neutrality,
Ukraine became a potential target of NATO expansion
as the Alliance perceived this move as a possibility to
prevent the influence of Russia. On the contrary, an
attempt to get into the CIS led Ukraine to the unwanted
Russian influence. Leonid Kuchma’s presidency (1994
-
2005) started with a tilt toward the East which, in
particular, resulted in signing the Treaty on friendship
and cooperation with Russia in 1998. However,
following the
West’s example, he tried to play a “multi
-
vector” policy but in much more complicated
circumstances, considering Ukraine’s importance for
Russia. As time passed, the West became more engaged
in the region which was seen in the Orange Revolution
of 2004. At the same time, it is important to highlight
how the Middle East looked within this context. Under
the new status, Russia determined its foreign priorities
in the regions where it either had political influence
before or mulled the possibility of expanding it. As a
result, the Middle East was considered among these
priorities but a relative indifference of the American
administrations toward the region facilitated the
Russian return. The war in Georgia in 2008 became the
prologue to the world systemic crisis that started in
2009. Certainly, it’s not a coincidence that Transnistria,
South Ossetia, and Abkhazia froze after the NATO
enlargement and in the early 2000s “the orange
revolutions” erupted in Ukraine and Kyrgyzstan as a
desperate attempt of Washington to change the
political course in Russia’s sphere of influence. The
Russian invasion of Ukraine in 2022 is a continuation of
the flawed geopolitical undertones seeking to reshape
the balance of power on the European continent.
However, the Middle East is a center of attention here
because the situation around Ukraine becomes a
catalyst for addressing the long-standing issues.
Origins of the Conflict
This conflict is rooted in a combination of nationalism,
ethnocultural factors, territorial disputes, and historical
grievances. After the decline of the Soviet Union,
Ukraine, which was formerly part of the USSR, became
an independent nation. However, Russia considers
Ukraine to be within its sphere of influence. Thus,
Putin’s Russia views any Western influenc
e in Ukraine as
a threat to its national security and, therefore,
unacceptable. On the other hand, many Ukrainians also
sought to break free from Russia’s influence and
embrace Western Europe as a refuge from the
oppressive and authoritarian Russia. Accordingly, two
largely opposite worldviews evolved within Ukraine: a
pro-Russian faction in the East and a pro-Western one
in the West. These opposing worldviews were further
complicated by the influence of external factors. In this
context, the elections of 2004 and 2010 are critical
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because both elections were contested amid rising
tensions between pro-Russian and pro-Western
factions (Pigliucci, 2018). The victory of Viktor
Yanukovych in the 2010 election, who represented the
pro-Russian faction in Ukraine, amplified these
tensions. The mass protests in 2013 during the
Euromaidan Revolution were sparked by Yanukovych’s
decision to reject a European Union membership
agreement under Russian pressure. In turn,
Yanukovych violently repressed the protests, which
forced him to flee to Russia in 2014. In the aftermath
of the Euromaidan Revolution, Crimea was annexed by
Russia, and pro-Russian separatist movements rose in
Eastern Ukraine, resulting in civil war.
In summary, the origins of the war are rooted in a
combination of deep domestic and ethnocultural
factors and external influences, with Ukrainian
geopolitics as the battlefield between the West and
Russia. It is also important to note that many
neighboring countries or powers have their own
strategic interests in this complex and volatile region.
This includes not only Russia and Ukraine but also
Poland, Hungary, Romania, and other countries, as
well as external powers such as the United States and
European nations. Furthermore, the issues at hand are
not simply contemporary, but as this overview shows,
are very much entrenched with histories that run deep.
Understanding the origins of the war is critical to
accurately understand the broader economic impacts
of the war and its spillover effects, especially on the
MENA region. Thus, this becomes a necessary starting
point and foundation for analyzing the continent-wide
and global economic impacts of the war.
Military and Political Dimensions
The Russian-Ukrainian War, with its pivotal military
and political dimensions, has far-reaching economic
consequences for the Middle East. Acknowledging
different analytical aspects is crucial, as military
conflicts often intertwine with political decisions
impacting various actors, including those in distant
regions. Therefore, military and political dimensions
must be examined to establish context for subsequent
economic analyses. While Ukraine illustrates how a
weaker economy can delink from a larger aggressor,
this is feasible only with backing from other strong
nations. As such, Ukraine's military and political
strategies, international supporters like NATO and the
EU, and Russia's actions impacting global economies
warrant scrutiny (Pigliucci, 2018). Having been invaded
by Russia, Ukraine undertook swift military actions to
reclaim lost territories. On the other hand, Russia's
military reach exceeded intent, given Ukraine's
proactive steps in the same direction. Despite
apparent Ukrainian deterioration, its military strategy
significantly differed from Russia's. Since the USSR's
collapse, both held considerable military capabilities,
yet their political strategies differed, impacting
economic arenas. Still, alignment with the West
exposed Ukraine to military action as Western nations
seemed more intent on supporting diplomacy and
sanctions than direct militaristic involvement. Russia's
endeavors in Ukraine, largely deemed unwarranted,
shifted global economic focus to military actions'
implications on international relations and involved
states' stability and security.
Players and Alliances
Motivations and Strategic Interests The Russian-
Ukrainian War is a large ongoing multinational conflict
centering on Russia’s illegal invasion of Ukraine that
began on 24 February 2022. Despite being largely
framed as a European conflict by Western media, the
war has global ramifications, resulting in worldwide
economic, energy, and food crises. Understanding the
major players and factions involved in this war is
essential to comprehending its broader international
ramifications. Likewise, an analysis of how this conflict
was catalyzed, escalated, and continues to be shaped by
the interplay of alliances would contribute to a clearer
understanding of how the war’s consequences will
reverberate in the Middle East and necessitate
responses from its nations (Pigliucci, 2018). The major
factions in the ongoing conflict are Russia, Ukraine, and
a coalition of Western nations, led by the United States,
the European Union, and NATO. Since taking office, U.S.
President Joe Biden has been intent on confronting,
containing, and isolating Russia globally. Drawing upon
the long history of post-World War II U.S. efforts to
undermine, encircle, and roll back Russian influence,
Biden’s strategy accelerated after the emergence of a
right-wing pro-U.S. government in Ukraine in early
2014. NATO expansion, along with the EU’s eastward
march, was viewed as intolerable by Russian President
Vladimir Putin (Thanh Ha, 2023). Russia responded by
annexing Crimea and backing up separatist movements
in the Donbas region of southeastern Ukraine, which
remains ongoing.
Ukrainian President Volodymyr Zelensky is fighting to
retain sovereignty over his territory and people. He is
astutely and aggressively leveraging what support he
can obtain from the Western coalition, doing so partly
in retaliation for losing thousands of Ukrainian lives due
to Russia’s invasion. However, despite Ukraine’s efforts,
it is increasingly isolated and does not constitute a
priority for the West compared to countering Russian
influence. The regional actors most relevant to this
analysis are Egypt, Turkey, and Iran. Their responses to
the conflict underscore the complexity of global politics
in a multipolar age. Egypt is aligned with the United
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States and has been since President Anwar Sadat
effectively abandoned Soviet support for Egypt in
return for American largesse in 1977. However, it is not
overtly condemning Russia’s actions in Ukraine even as
the conflict threatens to upend Egypt’s economy.
Regimes such as Egypt’s that are reliant on agricultural
imports, especially wheat, from Russia will be hit hard.
Likewise, Turkey NATO’s second largest military power
is tightly allied with Ukraine and condemning Russian
aggression, despite being a NATO member, it is
nevertheless pursuing a careful balancing act.
Economic Interactions Between Russia-Ukraine and
the Middle East
Despite being in different regions, Russia, Ukraine, and
the Middle East share similar paths of economic
development and make up mutually dependent
markets. Within this framework, the impacts of the
war between Russia and Ukraine on the Middle Eastern
countries are studied. Russia and Ukraine are two
countries important for the economy of the Middle
East. The war has affected trade, investment, and
financial ties with these countries. On the one hand,
economic relations may be strengthened (for example,
in energy or agriculture), while on the other, they may
be weakened (for example, in military-technical
cooperation and the high-tech sector) (Zhang et al.,
2024). This also shows how the war affects the change
of economic strategies in the Middle Eastern countries.
Economic diplomacy is particularly important in
meeting the new challenges arising from the war. In
the context of changing global economic ties, the
economic interactions between the conflict-affected
countries and the Middle East are examined,
presenting the situations of the individual Middle
Eastern countries. It is noted that although often local,
the conflicts can lead to a chain of consequences that
spread globally. The fate of these regions is
intertwined in the new geopolitical reality created by
the Russian-Ukrainian war and the ongoing
realignments at the global level. The economic
interactions between these regions, which have been
largely neglected in the existing literature, are crucial
for outlining future developments for the Middle East
as well as Eastern Europe.
Trade Relations
Amid the ongoing war between Russia and Ukraine,
the trade relations these countries share with the
states of the Middle East are of crucial importance.
Prior to the conflict, Egypt, Turkey, and the United Arab
Emirates were the most significant Middle Eastern
partners for Russia and Ukraine, with joint trade
volume reaching USD 10.1 billion in 2021 (Zhang et al.,
2024). Furthermore, Israel, Saudi Arabia, Bahrain, and
Oman also took part in this international exchange. The
traded commodities include energy resources,
agricultural products, and industrial goods which were
exported from or imported to these countries. Egypt
was heavily dependent on Ukrainian wheat import prior
to the conflict, taking 59.5% of its wheat import from
Ukraine in 2021, and thus influencing the regional
economy directly. As for Turkey, it was one of the few
countries which benefited from the changing trade
volumes, as a result of being the significant re-
exportation hub for the Russian goods towards the
West. These trade relations are to be explored in detail,
along with the character of goods exchanged. Following
the overview of trade relations prior to the conflict, the
focus will then shift on how these relations have
changed since the outbreak of war, including
unanswered questions on accessibility of the markets as
well as on the trade routes.
At the time of the conflict outbreak, the considered
trade volumes had already been declining for a year.
Nevertheless, Egypt was still far from finding alternative
suppliers in the wheat market and therefore was heavily
criticizing the Russian-Ukrainian war. This subchapter
also deals with the queries concerning the pricing and
amount of goods traded, as well as the possible paths
that the economies take considering these queries. The
direct influence on the regional economies due to the
waves of sanctions imposed on Russia is to be analyzed
as well, focusing on the questions of shifting the
exports/imports directions and the geo-political tension
growing in the area. Finally, due to the currently
changing trade patterns, the Middle Eastern countries
might seek for alternative partnership countries and
markets, and therefore the relevance of the researched
topic.
Energy Dynamics
Energy dynamics
–
or, in other words, oil and gas
markets
–
became critical in the Russo-Ukrainian War
and the events that stemmed from it. Energy resources
have geopolitical significance; otherwise, they wou
ldn’t
have been used as means of coercion, nor would they
have turned into foreign policy tools. Hence, paradigm
shifts of energy security in the context of the war are of
utmost importance, especially considering Europe’s
efforts to reduce dependency on Russian fossil fuels in
light of Russia’s aggression against Ukraine (Thanh Ha,
2023). Energy security was redefined in 2007 as
“uninterrupted availability of energy sources at an
affordable price,” which includes supply security,
market security, energy continuity, and resilience
against environmental challenges, but it has now been
reduced to “uninterrupted” energy availability.
Supply chains and production levels were disrupted
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because of the war and decided upon nations’
positions on energy security. After abstaining from
sanctions following Crimea’s annexation in 2014, the
EU froze Russian assets, sanctioned banks, and chose
to end its reliance on Russian energy post-Ukraine
invasion. Even though Russian fossil fuel exports
accounted for 61 and 60 billion euros for the EU and its
member states, respectively, in the first month of the
war, EU energy embargoes were critical post-Ukraine
invasion. Likewise, 44% of imported natural gas came
from Russia, accounting for 40% of electricity
generated from natural gas. Even so, EU gas imports
were crucial in funding Russia’s war efforts. For that
reason, the EU chose to REPowerEU, or end reliance on
Russian fossil fuels by (i) diversifying gas supplies,
importing more LNG from the US, and considering
pipelines from Azerbaijan and Central Asia; (ii)
boosting the share of renewables; and (iii) reducing
energy consumption. By assessing the Russo-Ukrainian
War, strategies to mitigate the energy security
consequences of changes in the war will be discussed,
as will how Middle Eastern countries reposition
themselves in the global energy landscape.
Energy trade has always been strategically important
for maintaining economic stability amid turbulence,
including the pandemic, global inflation, and even
wars. After the war broke out, countries looked for
alternative alliances to secure oil and gas needs.
Energy price fluctuations worldwide also reveal
broader economic fluctuations. In this context, energy
dynamics are crucial for understanding why countries
prioritize energy alliances in their foreign policies. The
Middle East remains significantly connected with the
consequences of the war because energy is still the
most pivotal element linking the region to the world.
Impact on Oil and Gas Markets
The
Russian-Ukrainian
War
has
far-reaching
consequences on the global economy, particularly for
oil and gas markets. Chaotic price volatility and
fluctuations emerge as the primary economic impacts
felt globally, especially in importing countries.
Determining the price increase magnitudes of crude oil
and natural gas, the agricultural sector’s fate as a net
exporter nation, and relative comparative statics could
infer the upheaval shock period through midday
estimation methods are employed. Using the similar
methodology and procedure as , tardy estimates
devote a detailed explanation of each discipline’s price
shock magnitudes in levels and time intervals. The
volatility is largest during the war period events,
although they were already elevated prior to the war.
Assessing
the
price
impacts
on
net
importing/exporting nations and relative comparative
statics and other control variables reveal that while
crude oil demand shifts cause adverse price impacts,
natural gas and agricultural disputes primarily cause
supply shortages price impacts. With equality and like
magnitude adjustments, augmented system estimates
clearly abide by comparative statics revealing that
quarrel related price uplifts are further amplified for net
importing countries across all disciplines. Consequently,
it is net importing countries that fully absorb the
elevated price impacts worsened by agricultural
demand side shocks . In oil-exporting states, the conflict
and ensuing economic sanctions pose immediate
substantial shocks to the supply chain, largely due to
heightened difficulty in logistics, insurance, transport,
and trade financing associated with shipping crude oil.
These factors collectively and significantly impact the
market’s ability to supply crude oil and are expected to
constrain supply by 5.55 million barrels or 5.57% per day
per month at baseline estimates, driving up global crude
oil prices by USD 38.87 per barrel or 31.6% as of March
1, 2022. However, translating agricultural supply shocks
through price impacts in the Middle East considers it a
net exporting region for both wheat and maize
empathizing with Russia-Ukraine quarrel. Initially, crude
oil prices closely tracked natural gas price increases but
later diverged after non-German countries enacted
alternative policies. In this regard, initially, oil exporting
nations readjusted their production levels due to crude
oil prices fluctuations. Recent estimates reveal that the
oil market is highly interlinked with the banking sector,
whereby oil related shocks impact both returns and
volatilities of the banking system, highlighting that such
countries readjust their own banking sector
transmission policies post-OPEC meetings instead of
crude oil price pathways. However, recent historical
evidence reveals that crude oil price fluctuations impact
growth equally across potently readjusting transmission
policies. Meanwhile, eurozone banking vulnerabilities
intensified post-war while prudential measures
improved. As a solution for energy policy and
investments directly resulting from the ongoing war
might consider it an immediate put opportunity for
alternative energies, yet broader market dynamics
direct price pathways might readjust strategies. With
the quarrel in mind, the market will force Russia-Ukraine
changes readjusted strategy considering global markets
are upended, and the Middle East seeks a new
foundation beyond EU grasp converting it into a
strategic player unseen since the Ottoman Empire’s
demise. It has become apparent that energy security
brings back historical politics dearly forgotten as new
constellations
are
sought,
whereby
broader
consequences embrace everything from food supply to
political security. Mechanically, the readjust path
translates into newly signed deals temporally prevailing
over price precision, although concerns could consider
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interference due to past experiences. Yet above all,
nations take caution and credibly seek diversification
experiments
regardless
of
horizon
length
commitments as bushel of grain price uplifts cautions
like bygone observation. Clearly, firmly emplaced
mechanisms fortify predictability, yet history testifies
that dramatically uplighting numbers presently appear
illusively coveted by the market as a whole forcing
some to abstain from temporally bringing back
strategies past forgotten. Ultimately, regarding a
country like Austria, it has become apparent that
everything
goes
ultimately
together
in
an
interconnected market, although at times forces act in
parallel realms stressing the necessity of joint and
coordinated actions when anything goes awry.
Everything fundamentally deals with politics, but
consequently, the broader approach reflects how
markets above all coherently act yet differently at
times driven by individual past experiences as best
strategy course might differ significantly.
Investment and Financial Flows
Alterations in investment and financial flows are
directly attributable to the Russian-Ukrainian War, the
repercussions of which need to be broad and far-
reaching to comprehend fully. Since the end of the
Cold War, the world has attempted to build a
globalized order where economic development would
promote democratization and respect for human
rights. This order's guiding influence on the world's
powers remained unchallenged, even through the
2008 Great Recession and Brexit. However, everything
changed after the COVID-19 pandemic, and the crisis
considerably upended capitalistic perceptions. Today,
what seemed normal yesterday is questioned. Notions
and constructs that capitalism has held true for a
century are examined. The Russian-Ukrainian War
profoundly influences investment and financial flows.
Foreign Direct Investment (FDI) flowing into countries
is widely considered a barometer of that country's
political and economic stability (Thanh Ha, 2023).
Examples abound of how geopolitical instability affects
FDI patterns. Middle Eastern countries withdrawing
investments from Lebanon is a case in point. The
rationale behind the withdrawal of investments from
affected regions is the need for searching for stable
alternatives. Here, the emphasis is on the role that
regional financial institutions play or may play during
times of crisis. These institutions need to provide
stable financial support for economically distressed
partners. Ex-post rapid assistance is also a
fundamental objective. Indeed, such assistance takes
place whenever the need arises. However, ex-ante
adjustments to the asset portfolios of players currently
involved in cooperative arrangements reflect an innate
tendency on the part of Western players to minimize
their exposure to possible adventitious volatility arising
from past experiences. In such a situation, cooperation
is maintained through the gradual tightening of its
terms. Adjustment of the political risks to FDI is offered
in an empirical model where countries with exposure to
political risk and controlling variables, such as inflation
and GDP growth, have confidence levels in FDI that
drop. Ultimately, there is a proposal for strategies to
mitigate political risks wherein investment portfolios
are diversified across countries facing different political
risks. Investments in energy and infrastructure are
particularly stressed type sectors wherein investments
become critically necessary during armed conflicts.
Overall, the hope is to shed light on what is, by the
present reckoning, so far very obscure and relatively
new ground in the advent of the Ukraine war.
Effects on Foreign Direct Investment
This section further investigates trends in foreign direct
investment (FDI) in the Middle East in response to the
Russian-Ukrainian war. It outlines how political unrest
and economic uncertainty in Eastern Europe are fuelling
the redirection of investments by some players in this
region. The focus is on determining whether
investments in the MENA region are being repurposed
towards more stable markets and sectors, and whether
such initiatives can remedy the deep-seated economic
growth and development challenges currently afflicting
many post-Soviet states. These issues are examined
using the latest available data on FDI inflows and
outflows, as well as other relevant economic indicators,
for the countries most directly affected by the conflict
(Hosen et al., 2024).
Along with an overview of the more immediate impacts
of the conflict on FDI trends, it is argued that in light of
the uncertainty generated by such events, there may be
opportunities for simply alternative investments, e.g., in
technology and renewable energy. Initially, some
possible options for the reallocation of regional
investment are outlined, followed by an analysis of how
companies based in the MENA region are attempting to
adapt to the risks inherent in large geopolitical shocks
affecting
an
entire
investment
environment.
Understanding such trends is considered vital if the
longer-term, and often unanticipated, consequences of
such shocks for the economic evolution of the affected
areas are to be grasped.
With reference to the Middle East, the focus is mainly
on the six members of the Gulf Cooperation Council,
plus Egypt and Jordan. Here, initial attention is directed
towards the most visible impacts of the current crisis on
FDI, followed by an overview of the region’s potential as
an alternative destination. In recent years, MENA states
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have generally struggled to achieve significant FDI-
driven economic growth, but it is suggested that a
broadened perspective may reveal the emergence of
viable investment opportunities in a number of
different areas. On the whole, however, as contention
grows between competing investment paradigms and
regional company aspirations shape their own
approach to risks associated with significant
geopolitical events, a middle ground is sought between
optimism and skepticism.
Agricultural Trade and Food Security
Wars produce risks and disruptions to food supply
chains. Russia and Ukraine export around 30% of the
world’s grain. The Russian
-Ukrainian War has
disrupted the food supply chains of several countries,
especially in the Middle East. War is projected to cause
problems in securing essential food imports for Middle
Eastern nations in 2022, 2023, and beyond (Deng et al.,
2022). Middle Eastern nations epitomize vulnerable
food systems reliant on seaborne grain. The region
imports three-quarters of its food; one-fifth comes
from Ukraine. The war worries large-scale disruptions
exporting grain via the Black Sea. In these countries,
the share of grain imports from Russia and Ukraine is
40-100%. Moreover, these countries have limited
options for alternative exports as food importers.
Fiscal space limitations impede these countries from
confronting food price shocks. Prior to the war, their
food systems were under stress from the COVID-19
pandemic, soaring grain prices, and a 2021 drought.
There is a large-net food-importing developing country
group. From 2001-2012 to 2013-2020, fifteen group
members in the Middle East, Africa, and South Asia
become more vulnerable, with 30%-100% estimates of
net-import share of grains. However, countries are
thought-adjusted agricultural policies from a simple
interface where countries are forced to externally
stipulate agricultural policy adjustments on shocks.
With agricultural trade networks, climate effects on
agricultural productivity are analyzed; countries
confronted depressed food export prices enforce
counterproductive food security strategies (Zhang et
al., 2024). Food security strategies reliant on imported
food supply have long-term implications. After shocks,
countries are unable to reverse policy adjustments,
i.e., ceilings on food export prices. Regional
cooperation is sought to enhance resilience by food
trade
network
interdependence.
Alternatively,
sourcing food from farther away is thought
(mis)calibrated strategies.
Transportation and Infrastructure Projects
Raimonds Briedis and Ashley Schaeffer argue that wars
and conflicts have a profound effect on infrastructure
and transportation networks, which then shapes future
development trends. Geopolitical conflicts continue to
influence logistical frameworks and the development of
infrastructure priorities, as seen with the repercussions
of the Russian-Ukrainian War in Europe. As one of the
Middle Eastern states bordering Ukraine, the war has
many
ramifications
for
transportation
and
infrastructure projects in the region. On one hand, some
goods previously transited through or to Russia and
Ukraine are now stuck or stranded, affecting trade. On
the other hand, many projects might be delayed,
affected, or redirected within the region due to the
ongoing war. Most freight trains coming to and from
Ukraine transit through just two border posts into
Europe, with around 75% of all goods flowing through
the most critical station in Chop. However, the Russian-
Ukrainian War shook the basis of all transiting logistics
because bad and destroyed roads, ethnic conflicts,
national priorities, and destroyed infrastructure re-
shaped the logistics in just a few days. Transportation
logistics have become much more complicated.
Moreover, the changes in logistic priorities have had
substantial economic consequences for both local and
regional economies starting from the COVID-19
pandemic
(Korovkin
&
Makarin,
2020).
The
development of infrastructure projects is crucial for the
economical growth of the countries, so understanding
the disruption of infrastructure projects due to the
Russian-Ukrainian War is vital. Although this conflict is
still ongoing and will render new opportunities for
alternative routes and partnerships, the Middle Eastern
countries are already trying to implement that (Zhang et
al., 2024).
Sanctions and Trade Restrictions
In response to the outbreak and escalation of the
Russian-Ukrainian War, a complex web of sanctions and
trade restrictions has been imposed by various
countries and international organizations. The
motivations behind these measures are diverse,
encompassing political, economic, and humanitarian
dimensions (Günes, 2019). Primarily, these sanctions
are seen as a political tool, aiming to influence the
actions and decisions of the Russian and Ukrainian
leadership. At the same time, they are expected to have
economic repercussions, targeting essential sectors of
trade in goods and investments, financial exchanges,
and energy markets.
Trade flows between Russia, Ukraine, and the Middle
East have experienced a significant decline following the
imposition of sanctions. Several countries in the Middle
East, including Egypt, Lebanon, and Turkey, have
witnessed a drop in imports from Russia and Ukraine
due to these trade restrictions. The analysis of trade
data reveals that while the sanctions initially caused
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immediate declines in trade volumes, other factors
such as alternative suppliers, regime change, and
ongoing military conflicts have accounted for long-
term declines (M. Nephew, 2015). Overall, the
sanctions and trade restrictions have significantly
disrupted trade relations between Russia, Ukraine, and
various Middle Eastern countries. This raises questions
about how these trade restrictions will be interpreted
and what broader issues they might bring to light.
These restrictions may have immediate repercussions,
but they may also compel policymakers to consider the
larger picture. There are worries that beyond the
regional implications of the sanctions, accomplishing
the narrower goals may prove inflexible to some states
in the years to come.
Countries in the Middle East willing to ignore these
sanctions may find it difficult to seek alternative
markets and trade partners. This is particularly true for
Egypt, Lebanon, and Turkey, all of which have heavily
relied on Russian and Ukrainian grain imports. The
recent war has forced these countries to pursue new
markets and trade partners. It is in their interests to
adapt to the new geopolitical circumstances,
suggesting that such countries will need particular
consideration in the regional reshaping of economic
strategies.
Implications for the Middle East
This part narrows down the specific implications of
sanctions and trade restrictions for the Middle Eastern
countries. After a brief overview of the sanctions’
effect on Russia and the resultant counter-sanctions, it
discusses how the sanctions reshaped the economic
relations and trades between the countries in the
Middle East. Thus, from the beginning, it describes the
new trade routes, partnerships, and sourcings as
strategic recalibrations due to the sanctions are
discussed. Also, it explains the realignment of traded
goods and how the new geopolitical landscape
rerouted the traded goods. As energy markets and
agricultural exports are crucial for Middle Eastern
economies, this part sheds light on the reshaped trades
and market prices in these sectors too. In general, it
depicts the challenges and opportunities in managing
the ramifications of the sanctions or restricting trades.
Overall, the complexities of maintaining economic
steadiness while seeking opportunities are discussed,
all of which provide insights for policymakers. The
Russian-Ukrainian War has reshaped geopolitical
landscapes and energy markets. Since the onset of the
conflict, a series of sanctions and trade restrictions
forced nations to re-evaluate their partnerships. In
return,
Russia
implemented
counter-sanctions,
prohibiting certain trade agreements with the nations
involved in the sanctions. Although trade restrictions
aimed to isolate Russia economically, it offered the
Kremlin an opportunity to pivot and build alliances with
non-s
anctioning countries. Nonetheless, Russia’s
isolated progress is debatable, as the implementation of
restrictions was a blow to the nation’s economy. After
all, the economy plunged and was forecasted to further
decline. Therefore, as in many other regions, the
implications of sanctions on Russia and the consequent
trade restrictions are assessed for the Middle East
countries (Günes, 2019).
Regional Responses and Alliances
As Russia’s invasion of Ukraine enters its second year,
the impact of the war on the Middle East is coming into
focus. As a historic land bridge between Europe, Africa,
and Asia, regional countries have been buffeted by the
geopolitical and economic storms from each of the
three cardinal directions. Just as COVID-19 exposed the
fragility of supply chains, price shocks from the energy
and food markets brought on by the war have prompted
a re-evaluation of national security and foreign policy
strategies in the Middle East. Nations of the region
maintain divergent yet interlinked economic and
political responses to the dictates of external powers,
first and foremost the U.S., Europe, Russia, and China
(Libman, 2015). Understanding how these comings and
goings influence intra-regional dynamics is key to
considering how countries may band together or
diverge in the face of conflict and crisis. Underpinning
the ebb and flow of alliances and disputes among
Middle Eastern nations are shared historical ties and
economic interdependence, which take on a heavier
significance in responses to external threats and
conflicts. On the one hand, it is these factors that shape
collective responses to the outside world; on the other,
they leave nations vulnerable to a combination of
spillover effects and attempts by outside powers to
manipulate ties for their own ends. It is these regional,
intra-
regional responses that are the focus, as the war’s
effects ripple across the Middle East. Predictions about
the direction of future diplomatic rapprochements and
economic collaborations thus require an appreciation of
regional as opposed to purely national or bilateral
considerations.
Considerations
of
extra-regional
alliances and inputs are left to one side, although they
remain essential factors. In particular, efforts by Russia
and China to exploit divisions within the West and
among poorer countries are noted.
Position of Arab League Countries
The War in Ukraine continues to raise geopolitical
tensions across the globe and affects widespread
different spaces. Amid this conflict, food insecurity
concerns have arisen in several countries, especially in
the Middle East. This war is setting off an
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unprecedented economic catastrophe, increasing
aggression, and upending geopolitical equations in the
Arab world. Russia’s invasion of Ukraine poses a huge
challenge for Arab countries regarding the cohesion
and functionality of the Arab League. The position of
the Arab League countries deals with the official stance
of these countries in regard to the War in Ukraine and
the resulting impacts on cohesion in the region.
Although there have been efforts to achieve a unified
response, the Arab League is faced with challenges due
to the difference in national interests and other
geopolitical considerations. Most Arab nations are
trying to balance relations with Russia and the western
powers, which has significant implications for trade,
energy, and security (Amat Nasir et al., 2022).
Amid the War in Ukraine, the Arab League could be
perceived as a potential mediator in the space
between the East and the West, but such a function is
hamper
ed by the differences in member countries’
positions. This exacerbates the long-standing issues of
functionality and coherence of the Arab League. As the
War in Ukraine unfolds, the solidarity or the division of
the Arab countries has to be analyzed. After the
Russian annexation of Crimea, the Arab League
members took diverging positions, which are
examined and focused on the cohesion and
functionality of the Arab League. During the War in
Ukraine, a similar situation occurs as some Arab
countries supported the Ukraine, while others sided
with Russia. The positions taken by these countries will
shape future diplomatic and economic relations in the
Middle East.
Case Studies
This section presents case studies of specific countries
in the Middle East, illustrating how the Russian-
Ukrainian War has shaped their economies. Each
example highlights the unique challenges or
opportunities faced by the nation and examines how
the war’s ripple effects play out across diverse sectors.
These case studies include analyses of how the energy
shock has affected agricultural production in Egypt;
how the complex web of wars and sanctions in Syria
has altered investment flows; and how the Gulf states
are navigating their relations with Russia, Ukraine, and
the West. In each case, nations respond differently to
risks and opportunities brought by the war, often
choosing options not immediately evident from their
circumstances. As such, these examples emphasize
that while regional trends and pressures exist, it is
localized actions that best explain broader economic
phenomena (Thanh Ha, 2023). Thus, the choice of case
studies emphasizes that balance sheet-level economic
management emerges from the complex interplay of
domestic policies and external pressures. These
examples are not necessarily the largest or most
representative, but each highlights a different
dimension of how economies are managed in the face
of external shocks. The Russian-Ukrainian War
significantly impacts the global economy, with particular
regional implications. Understanding the ways in which
economies respond to such events deepens insight into
broader economic trends. Since the war began,
extensive analyses have appeared on its global or
regional economic implications, often focusing on the
West or large emergent economies. However, the
Middle East is significant, as many states are shaped by
the war’s shocks in ways peculiar to their histories and
economies. Moreover, the ripple effects of the war
present both challenges and opportunities for local
states. As w
ith past regional crises, the war’s effects
manifest in unique ways in localized economies.
Impact on Specific Middle Eastern Economies
This subsection looks in detail at how the Russian-
Ukrainian War has affected specific Middle Eastern
economies. This focuses on the direct impact these
economies have felt, such as the adjustment of trade
flows, investment shifts, and changes in economic
stability, as well as the vulnerabilities. While there are
economies that have fared better, the focus is on how
countries have strategically adjusted to the disruption
caused by the war in energy, agriculture, and other
sectors.
New
partnership
and
collaboration
opportunities are also addressed. The economic
landscape is complex, with many nations facing unique
challenges requiring individual responses. As such, the
war’s impact on individual economies is explored, the
wider regional implications are analyzed, and the
lessons learned are presented for the consideration of
those involved (Zhang et al., 2024). The Russian-
Ukrainian War continues to rapidly reshape the global
economic landscape, especially in the aftermath of the
COVID-19 pandemic. In the Middle East, the war is
especially salient as it takes place in Europe,
destabilizing a region that has been a focus of Western
powers over the past decades. It has direct economic
consequences for the Middle East, as many nations in
the region are vulnerable because of their reliance on
imports from Russia and Ukraine, especially wheat,
barley, corn, and sunflower oil. Ukraine is considered
the “breadbasket of Europe,” while Russia provides
much of the world’s energy. The war
-induced
disruptions could threaten food security in the region,
as was observed during the Arab Spring (Thanh Ha,
2023).
Future Scenarios and Policy Recommendations
Taking into account the time frame being reviewed
here, several scenarios are presented regarding the
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future of Russia, Ukraine, and the West, as well as their
implications for the Middle East (Ross Smith, 2017).
Forecasts are perhaps more essential than ever, given
the uncertainty surrounding the ongoing war, a conflict
that is projected to extend far beyond one year. On the
one hand, it is clear that the wider geopolitical
landscape is transforming, and new economic
conditions are being created that will affect the Middle
East. On the other, in order to mitigate adverse
impacts, both proactive and reactive strategies can be
devised. Strategies are not straightforward in the
context of the ongoing war, given the uncertainty
surrounding possible developments and the fact that
the economic outcomes remain for the most part
beyond direct control. There are two levels of policy
response, with the first focusing on how economic
resilience and adaptation can be ensured in a highly
uncertain environment. It is examined how existing
partnerships can be leveraged to secure better
outcomes, while at the same time exploring the
implications for the wider global order of the scenarios
that are depicted.
Proposed future scenarios are intended as a starting
point for discussion on this second level, with attention
devoted to the possible longer-term geopolitical
developments that would shape economic conditions
in the Middle East. The scenarios sketch possible
changes in the global order, in alliances and trade
r
elationships, and in the West’s relationship with
Russia after the end of the conflict. Hopefully, by
outlining these scenarios, possible futures are made
more tractable and thus stakeholders are better
prepared for them. It is important to stress that the
scenarios are not predictions, as outcomes depend on
a number of contested factors. Indeed, the overall
point is that there is considerable scope for shaping the
outcomes. The scenarios thus indicate the pathways
along which outcomes could materialize, while being
aware that the actual future might play out quite
differently. Nevertheless, the scenarios highlight what
is deemed the most significant set of variables
affecting the future, or at least the most likely ones.
Ultimately, these are decisions that key actors make,
with the West’s approach to Russia being central in this
regard.
Potential Economic Strategies
As the Russian-Ukrainian War reshapes geopolitical
and economic landscapes, Middle Eastern countries
must consider specific economic strategies. First, trade
partnerships should diversify. With changes in trade
relations among Russia, Ukraine, and Europe,
continuing reliance on pre-war trade ties, especially
with Ukraine, poses risks. Instead, Middle Eastern
nations should forge new alliances and strengthen
established ones with unaffected countries, capitalizing
on evolving trade flows (M. Nephew, 2015). Second,
investing in alternative energy sources and related
technology is paramount. The war’s effect on oil and gas
markets
underscores
the
need
for
energy
diversification. Middle Eastern countries should pursue
investments and partnerships beyond oil, gas, and
renewables, seeking security-stream technologies.
Embracing these developments mitigates risk from
traditional dependencies. Third, increased regional
cooperation and integration bolster economic stability.
The
war's
impact
highlights
globalization
vulnerabilities
—
earthquake-like shifts ripple widely.
Middle Eastern countries should consider deeper
integration akin to Gulf Cooperation Council systems,
creating refuge from external shocks. Finally, economic
policies must adapt to real-time conflict developments.
Gradually, the war’s economic impact moves from
immediate trade shifts to longer-term investment
climate changes. Middle Eastern nations should closely
monitor all conflict aspects, adjusting policies and
interventions
as
needed.
Analyzing
similar
circumstances offers valuable insights. Emphasizing
actionable recommendations, this analysis assists
policymakers in navigating post-war complexities.
Ultimately, economic strategies enabling resilience to
crisis uncertainties prove vital. Forward-looking, concise
recommendations equip Middle Eastern nations with
necessary tools to confront the war’s challenges head
-
on.
CONCLUSION
The Russian-Ukrainian War and its far-reaching
consequences have been explored and analyzed, with a
special focus on the Middle East countries. Existing
literature has been surveyed and case studies of
selected Middle East countries
–
Egypt, Iran, and Saudi
Arabia
–
have been highlighted. As an introduction to
the selected case studies, the significance of military
and political developments as well as their economic
implications has been discussed in a wider context,
initially focusing on the global implications but later
zeroing in on the Middle East region (Mariela Méndez-
Prado & Andres Medina-Castillo, 2023). The Russian-
Ukrainian War, which began on February, 2022, is the
latest military conflict to take place between 2010-2022,
a time-period particularly examined in relation to the
Arab World and Middle East. Military conflicts have a
great impact not only on the regions in which they take
place but also on global economic patterns as they
trigger rippling effects across regions. That being said,
countries, or groups of countries, that might not be
directly impacted by the military conflict still face far-
reaching consequences in various forms. Thus, there is
a strong need to understand such ongoing military
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conflicts, particularly their political and economic
implications for the countries in a wider region (Thanh
Ha, 2023). In this context, countries in the Middle East
will be paid particular attention to.
As the 2nd decade of the 21st century unfolded, the
Arab World plunged into far-reaching public uprisings
that came to be known as the Arab Spring. Public
uprisings against authoritarian regimes were first
witnessed in Tunisia in December, 2010, but soon
spread to a number of Arab countries including Libya,
Egypt, Syria, and Yemen. The far-reaching impact of
the public uprisings, civil protests, along with the
military crackdowns against the protesters in different
Arab countries on the economic growth rate, trade
openness, foreign investment inflow/ outflow, and
inflation rate of the 22 Arab countries from 2010 to
2022 have been examined. As an aftermath of public
uprisings and civil conflicts in different Arab countries,
the global food price increase in 2011 and the
subsequent cascading effects in the Arab countries
have been also analyzed. The Arab Spring and the
subsequent civil conflicts that broke out in a number of
Arab countries provided the motivation to examine the
economic impact of the military conflicts and political
uprisings on a particular region
–
the Arab World
–
and
its individual countries. A similar approach has been
taken in the context of the Russian-Ukrainian War,
which is currently the latest ongoing military conflict
with far-reaching consequences. With the Arabic
language thoroughly shaping the analysis of the Arab
World, rigorous academic investigations of the Arab
World’s military conflicts, political uprisings, and their
far-reaching economic impacts on a particular region
have been conducted. The quick overview of the case
studies has also been included in the beginning to
provide a roadmap for the readers. It is hoped that the
discussions and findings presented in this research
essay will provoke critical debates and discussions
regarding policy recommendations and strategies to
tackle the uncertainties being faced.
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