DUBLIN–(BUSINESS WIRE)–#creditratingagency–KBRA releases a research report on the impact of geopolitical tensions on European corporations and energy markets. Rising geopolitical tensions pose indirect risks for corporate profitability and inflation in Europe via their potential impact on energy prices, transportation costs, and feedthrough into broader macroeconomic conditions. To date, the impact of the events in Ukraine and the Middle East and the ongoing risk of escalation have had a relatively mild influence on commodity prices. In contrast, shipping costs have experienced more volatility, and their impact on corporate profitability will largely depend on the current tensions being sustained. Despite a deterioration in terms of geopolitics, global economic forecasts and sentiment have improved, and energy prices have broadly remained range-bound. However, the risk of an increased impact remains high.
Key Takeaways
- Geopolitical risks remain elevated.
- Energy prices have not been dramatically impacted by the Israel-Hamas war and the recent Red Sea troubles owing to a number of reasons, such as the limited disruption to global supplies and muted demand.
- Shipping costs have endured the impact of the Middle East conflicts. While these have yet to have a major impact on European corporate input costs to date, there remains a significant risk that cost pressures will intensify should an already tense environment escalate.
Click here to view the report.
Related Publications
- European Corporates: Margins Temper and Production Slows
- Uncertainty Reflected in Corporate Surveys
- Private Credit: KBRA-Rated Private Equity and Private Credit Firms Remain Resilient Despite Challenging Environment
- Current European Labour Dynamics to Impact Core Economies
About KBRA
KBRA is a full-service credit rating agency registered in the U.S., the EU, and the UK, and is designated to provide structured finance ratings in Canada. KBRA’s ratings can be used by investors for regulatory capital purposes in multiple jurisdictions.
Doc ID: 1003302
Contacts
Gordon Kerr, Managing Director, Head of European Research
+44 20 8148 1020
gordon.kerr@kbra.com
Karim Nassif, Senior Director
+353 1 588 1245
karim.nassif@kbra.com
Garret Tynan, Managing Director, European Head Project Finance and Infrastructure
+353 1 588 1235
garret.tynan@kbra.com
Andrew Giudici, Global Head of Corporate, Project, and Infrastructure Finance
+1 646-731-2372
andrew.giudici@kbra.com
Business Development
Mauricio Noé, Co-Head of Europe
+44 20 8148 1010
mauricio.noe@kbra.com
Miten Amin, Managing Director
+44 20 8148 1002
miten.amin@kbra.com
