Escalation Of Ukraine Conflict May Trigger Renewed Energy Crisis In Europe - IMF

An escalation in the Ukraine conflict could potentially trigger a renewed energy crisis in Europe and exacerbate food insecurity in poor countries, the International Monetary Fund (IMF) said on Monday.

"An escalation of Russia's war in Ukraine--now in its second year-- could trigger a renewed energy crisis in Europe and exacerbate food insecurity in low-income countries," the IMF said in a report.

A gas crisis was avoided this winter due to sufficient storage at European facilities credited to higher liquefied natural gas (LNG) imports, lower gas demand amid high prices, and atypically mild weather, but the risks of price spikes remain for next winter, the IMF said.

Moreover, a possible increase in food prices from a failed extension of the Black Sea Grain Initiative would weigh further on food importers, and elevated food and fuel prices could spur social unrest, according to the IMF.