Growing tensions with Russia could hit growth in Europe this year and next, warned the European Commission in its latest outlook.
“Should further rising tensions with Russia lead to major disruptions in oil and gas supplies with a sharp rise in prices, the negative impact on a number of Member states could be sizeable,” the Commission said.
Russia is facing off with the U.S. and Europe over the worsening situation in Ukraine. Western leaders accuse Russia of helping encourage protests and lawlessness in Eastern Ukraine — a claim which Russian officials have staunchly denied.
The U.S. and Europe have each slapped sanctions on many Russian companies and individuals. Meanwhile, Russia has warned that its natural gas exports to Europe could suffer as it considers cutting off gas to Ukraine — a key transit route for gas to Europe.