Conflicts of Interest: The Environmental Costs of Modern War and Sanctions

The devastating and ongoing Russian invasion of Ukraine has not only triggered significant loss of life and a massive refugee crisis spilling into Europe, but has also dealt a heavy blow to a silent victim of modern-day military and economic warfare: the environment.

Since February of this year, the war in Ukraine and sanctions on Russia have collectively induced a steady rise in crude oil prices, disruption to global grain and fertiliser markets, environmental damage, and reactive forced-hand policies to divest from Russian energy sources. Together, these unforeseen effects are catalysing ad hoc policies and coping mechanisms that will continue to stress global markets, strain natural resources, and increase carbon emissions – a cascade of events that collectively counteract the international community’s pursuit of the Paris Climate Accord goals of 2015.

While Russia’s military incursions in Ukraine have contributed to these environmental shocks, sanctions from the US and its allies have played no less a role in fuelling them, raising the inevitable question: how exactly are conventional economic sanctions and modern-day warfare counteracting progress towards international climate goals?

Sanctions’ Impact on the Economy, Agriculture and the Climate

In response to President Vladimir Putin’s invasion of Ukraine, the US and its allies imposed a wave of punitive sanctions on Russia’s economy and financial elite. These sanctions have targeted the country’s central bank, severing several key Russian banks from the powerful SWIFT (the Belgium-based Society for Worldwide Interbank Financial Telecommunication) messaging platform that facilitates payments for the international import and export of goods; banned the import of Russian goods; and seized key Russian international assets.

The most visible and immediate environmental consequences of sanctions on Russia thus far have been the volatile transformations we have witnessed in global oil markets. Even in recent days, oil prices have surged as discussions continue on a concerted EU embargo on Russian oil.

Crude oil prices began to increase following US President Joe Biden’s decision in March to ban imports of Russian oil and gas. The UK similarly moved to phase out Russian oil imports by the end of this year. While 8% of US oil and refined product imports come from Russia and 6% of the UK’s, Russia last year accounted for roughly 25% of the EU’s oil imports and 40% of its natural gas imports – a significant share that has made it difficult for the region to introduce an all-out ban.

A proposed concerted EU ban to phase out dependence on Russian oil by the end of the year is now on the table, and anticipation of this has contributed to the surge in oil prices in recent days. Nevertheless, there remains some apprehension over proceeding with the embargo among some EU member states such as Hungary, which fear a lack of viable alternative energy sources to meet local demands.

US President Joe Biden was elected on promises that he would prioritise climate change, decarbonise the country, and engage diplomatically with Iran to resurrect the 2015 Joint Comprehensive Plan of Action (JCPOA). In fact, he re-joined the 2015 Paris Agreement on his first day in office after his predecessor, President Donald Trump, abandoned the landmark climate deal. Nevertheless, sanctions on Russia have pushed inflation to record highs, prompting the Biden administration to attempt to ease inflation by tapping into strategic domestic reserves at home. This has resulted in drillers pumping harder to release millions of barrels of oil to supply increasing demand, and a temporary allowance of the sale of cheaper, higher-emission E15 gasoline this summer. These moves, though opportune, will inevitably contribute to higher emissions in the short term, counteracting the Biden administration’s promise to move the US – one of the world’s top emitters – away from fossil fuels.

As the world’s second largest crude oil supplier and second largest producer of natural gas, pressure on Russia’s energy market means pressure on world energy sources. In addition to crude oil price volatility, natural gas prices rose recently following Ukraine’s move to shut off a major gas pipeline that supplies a third of Russia’s natural gas exports to Western Europe. The Gas Transmission System Operator of Ukraine declared a ‘force majeure’, citing Russian-backed separatists interfering with the station’s operation and siphoning off gas from areas now under the control of Russian troops. Though gas prices swiftly returned to previous levels again, this incident further illustrates the complexities and instabilities facing the international community as the Russo-Ukrainian conflict continues.

The timing of these economic shocks and adjustments in oil production coincides, interestingly, with the ongoing deadlock in negotiations involving the revival of the JCPOA. A loosening of these sanctions could also open the supply of Iranian oil to global markets and thereby offset Russia’s decline in output. Tehran, however, seems to be in no rush to resurrect the 2015 nuclear deal, as higher oil prices has given Iranian officials a means to increase revenue in the short term to sustain the country’s already-stressed economy.

Geopolitical crises often expose flaws in long-held domestic and foreign policies, but they also reveal opportunities for rethinking and change. Volatility in Russia’s oil and gas markets has exposed the EU’s heavy dependence of foreign energy sources and demonstrated the importance of achieving domestic energy security. A concerted EU ban on Russian energy in the short term is likely to manifest in heightened carbon emissions and costs for member states, as they will have to scramble for viable alternative sources like coal, which has a greater carbon footprint. In the long term, however, abrupt and accelerated divestments from a reliance on Russian energy will provide an opportunity for currently importing countries to move towards greater energy independence and expedite transitions to cleaner, renewable sources.

Sanctions and their Costs: Iran and Russia

The environmental impacts of sanctions can cause more than just external trade shocks. Our work at Imperial College London’s Centre for Environmental Policy finds that while economic sanctions do not directly impact the environment, their secondary impacts can act as a ‘catalyst’ that compounds existing managerial, environmental and socioeconomic realities to induce difficulties in environmental protection and sustainable development efforts locally. As a form of economic coercion, sanctions often target a country’s central modes of income to weaken the target government. In oil-rich countries like Iran, decades of Western-led economic sanctions have aimed to target and weaken key sectors of the country’s economy that are all crucial for sustainable development – namely the energy, automotive, aviation, shipping and financial sectors.

Escalating sanctions and increased isolation from the international community cast self-sufficiency schemes in a compelling light: a means of defying Western coercion while proving the country’s strength in the light of crippling sanctions. To sustain its diminishing economy, Iran turned inward, overstraining its natural resources in pursuit of accelerated development. Prolonged US sanctions against Iran inadvertently induced a survivalist mentality, hallmarked by unforgiving costs to the environment that will take generations to remedy.

While it is unclear how long the war or sanctions will last, early signs from Russia’s response have mirrored the trajectory of Iran’s in noteworthy ways. Moscow has retaliated against sanctions by banning over 200 commodities in diverse industries such as telecommunications, agriculture and the medical industry until the end of this year. One example is that Russia has advised chemical companies to suspend the export of methanol derivatives, which are essential inputs in applications such as pharmaceuticals, cosmetics and chemicals. This illustrates that environmental risks induced by transformations in trade due to sanctions can be triggered by both sending and receiving countries.

The Impact of War on the Environment

History reminds us that war not only lays waste to economies, countries and populations, but it also wreaks havoc on the physical environment – especially in a heavily industrialised country like Ukraine. A major ingredient of modern warfare is oil, a fossil fuel that breathes life into the arsenal of conventional militaries and their armaments: tanks, fighter jets, aircraft carriers, submarines, armoured vehicles, and missile systems. These tools of modern warfare lead to high carbon emissions and can physically destroy urban, rural and agricultural infrastructures.

Kyiv, Kharkiv, Mariupol and the larger Donbas region in Southeast Ukraine, where the thick of the fighting during Russia’s invasion has occurred, are home to industries like petroleum refineries, chemical plants and radioactive waste repositories that have been attacked. With a steady barrage of attacks and missiles striking refineries, chemical and energy plants, nuclear facilities, water stations, and ammonia pipelines, the country's air, water, and soil have been poisoned and contaminated, collectively posing serious health risks to the population. For example, in the Donbas region – Ukraine's coal capital – the war has devastated many coal shafts, which are not only critical for supplying the economy, but following their recent abandonment have been flooded with acid mine drainage, which is in turn infiltrating crucial groundwater sources.

In addition to these risks from the destruction of industrial sites, spilled fuel, chemicals and heavy metals from army vehicles and detonated missiles can lead to the contamination of soil, groundwater and air, which poses risks to human health.

Already a heavily industrialised economy with one of the poorest track records of air quality in Europe, Ukraine had been suffering ecological damage long before Russia’s recent invasion. Smoke from outdated iron and steel plants previously filled the skies above Mariupol, one of Ukraine’s most polluted cities before the war. Today, pollution from industrial activity is replaced by fumes from a ferocious barrage of weapons, blasts and ammunition. The extent of environmental damage will be hard to measure. Emissions will go unreported as monitoring systems have been disrupted or destroyed.

Mass migration of refugees fleeing into Europe could pose greater stresses on ecosystem services in countries opening their doors to refugees. The gravity of these costs reinforces the fact that war-induced environmental damage is not geographically confined and has far-reaching consequences both domestically and abroad.

The Impact of War on Agriculture

Heightened conflict between two of the world’s major agricultural suppliers, which together account for nearly one-third of international grain exports, has caused great uncertainty and volatility in food security and global markets.

While the coronavirus pandemic had already strained these markets, the Russo-Ukrainian War has exacerbated the situation for poorer countries in North Africa, Asia and the Middle East – regions that depend heavily on wheat imports from both Ukraine and Russia. According to the UN World Food Programme, food prices will continue to rise, forcing the leaders of these countries to scramble to meet changing market conditions.

Heavy shelling and explosions have rendered vast areas of arable land in Ukraine no longer suitable for agriculture or habitation. Furthermore, disruptions to the agricultural activities of Russia and Ukraine, including the ability of farmers who may have been displaced by the war to harvest their crops, have been compounded by export bans for staple goods issued by the Ukrainian and Russian governments.

Similarly, as a lead producer of fertiliser, Russia’s war and subsequent sanctions have not only caused food prices to spike but have also placed great strain on the world’s major agricultural systems. According to the UN, the price of urea, a key ingredient in fertiliser, tripled in the past year.

Russia is a key exporter of agricultural fertiliser inputs including ‘potash, ammonia, urea and other soil nutrients’, but sanctions have jeopardized the trade of these essential agricultural goods. Last year, Russia and Belarus accounted for more than 40% of global exports of potash, an essential nutrient to ensure heightened agricultural output. Belarus is unable to fill the gap because it also faces Western sanctions.

Understanding Sanctions and Their Unintended Costs

A guiding principle of the Paris Agreement is ‘common but differentiated responsibilities’, which encompass a communal obligation for all countries to safeguard our climate, differentiated based on abilities and the idea that developed and developing countries have contributed to climate change differently, so duties should be shared accordingly. Russia, Ukraine, Iran and the US were all signatories to this monumental agreement. However, the divisive and destructive risks that war and sanctions pose to the environment counteract the collective effort needed to combat climate change on a global level.

Sanctions and war remain instrumental tools in the arsenal of state power in the 21st century, but foreign policies aimed at narrow strategic objectives cannot proceed unchanged at the expense of environmental peril.

The ancient legend of Achilles’ Heel offers a cautionary tale about the possible limits of war and sanctions and the larger existential blind spots we miss in the devastating costs to our environment. Thus, it is the responsibility of future policy and scholarly circles to engage and expand research on the interdependencies between war, sanctions and the environment, in order to help create policy that is more aligned with sustainable development and achieving the Paris climate goals.

The views expressed in this Commentary are the author’s, and do not represent those of RUSI or any other institution.

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