War in Ukraine: Twelve disruptions changing the world—update

| Article

Russia’s war in Ukraine is an ongoing tragedy, destroying lives and livelihoods in Ukraine and altering economic patterns worldwide. In May 2022, we set out an initial analysis of 12 disruptions that the war could unleash. With the passage of time, it seems increasingly likely that the war, coming so soon after a global pandemic, could presage a new economic era. We have been here before: today’s shocks are reminiscent of the immediate aftermath of World War II (1944–46), the oil crisis (1971–73), and the breakup of the Soviet Union (1989–92). Each of those events changed the global landscape with the sudden release of powerful underlying forces that had been building up around a fault line over time. Each ushered in a new era.

To understand the shape of the era now unfolding, we have tracked the evolution of the war’s disruptions since May 2022. At that time, some disruptions were already well under way—notably the humanitarian crisis that followed immediately from the invasion. As we highlighted, others were less predictable but worth watching—for example, we noted that the direct impact of the war on financial systems had so far been limited, but that risks from wider ripple effects might materialize.

In this update, we look at what’s happened in the 16 months since the invasion. As recent events in Ukraine highlight, the ultimate outcome remains profoundly uncertain. However, we find five disruptions with clear effects that may endure: the humanitarian crisis, energy source diversification, defense spending increases, cyber as a stage for conflict, and corporations’ pull-back from Russia.

Three other disruptions have eased, as connections in our global system, together with cooling of demand, buffered their effects. These include spikes in prices and supply disruptions for food, metals, and minerals, which have now dissipated.

Of course, in the past year, forces beyond the war in Ukraine have also roiled the system in compounding, intertwined ways: the steady rise of interest rates, China’s lockdown and reopening, severe weather, and broader geopolitical tensions. All are contributing additional uncertainty. These forces have become the most important drivers of three more disruptions we noted in May 2022—most prominently, the burden carried by the poorest people, a splintering of tech standards, and financial-system instability.

Ongoing and persistent disruption

The war’s impact has persisted across several spheres, from the humanitarian crisis to energy market shifts. Although some of the conflict’s long-term outcomes remain unclear, these once-emerging dynamics have begun to solidify.

The humanitarian crisis has moved past border countries

Roughly 12 million Ukrainians are displaced, and refugees are moving ever farther from home.

Europe is diversifying its energy sources

In 2022, Europe turned to the United States and other suppliers of liquefied natural gas and cut consumption.

Defense spending is rising

Following the invasion of Ukraine, defense spending accelerated in most border and former Eastern bloc countries.

Cyber and conventional forces combine for joint attacks

Cyberattacks continued in 2022 with no notable increase.

Corporate actors have pulled back from Russia

Many companies have left or scaled back operations in Russia.

Resilience and recalibration

Some of the initial shocks from the invasion have leveled out. In particular, high prices in select sectors have reverted to prewar levels, while global value chains have filled production gaps.

Spikes in agriculture prices eased and supply remained steady

Prices for critical minerals and metals spiked, then returned to prewar levels

Global value chains filled in production gaps across commodities

Compounding complexities

In May 2022, we thought that the war in Ukraine might directly and unambiguously influence these areas. It hasn’t. Instead, the ongoing conflict is one of several forces that are complicating important aspects of global affairs.

Technology as a vector for geopolitical tension

Western tech companies are leaving Russia but some Chinese companies are staying; Russia depends on China for much of its tech.

The financial system continues to cope with evolving risks

Russia’s war in Ukraine has produced systemic stress in Europe similar to other recent events.

Poorer people have suffered more

Europe’s poorest populations have spent more on necessities; elsewhere, millions have slipped into acute food insecurity.

Volatility, volatility, volatility

The Greek philosopher Heraclitus taught that all things are in continual flux, and change is the only constant. That certainly seems true today.

Uncertainty abounds

Volatility has retreated somewhat from 2022 highs but remains elevated.
Leaders say geopolitics is the top concern for the global economy.


As we noted in May 2022, these disruptions are already affecting people’s lives and livelihoods with potent force and should be part of every company’s scenario planning. The past 16 months have shown that the trends set in motion by the war are far from dispositive regarding the global economy. Each will bear watching over coming months.


Explore a career with us