The war in Ukraine is causing financial shockwaves.

Although it seems that the global economy has managed to stabilize itself from the turbulence caused by the Russia-Ukraine war, the continued Russian offensive is once again jolting financial markets. Russia’s invasion of Ukraine began when countries were already fragile due to the pandemic, and it seems like every piece of news coming from the region has the potential to cause a stir.

Markets are once again under relentless pressure amid disrupted supply chains, erratic financial markets, and soaring inflation rates. Consequently, there is a rising apprehension of the potential repercussions of this conflict and how it can impact everyday life.

Russia and Ukraine are major producers and exporters of various commodities, and this conflict has substantially damaged supply flows. As Russia is the world’s third-largest producer of crude oil, restricted exports due to sanctions are greatly impacting its neighbors. Fuel prices have climbed significantly, with the price of Brent crude oil touching $102 per barrel, adding to inflationary pressure. Food costs have also surged as Russia and Ukraine, the top exporters of sunflower oil and wheat, are unable to process exports. This food crisis is likely to weigh heavily on reliant regions, resulting in further economic segregation.

Moreover, uncertainty has fueled volatility in stocks and currency markets. This is mainly because traders’ and investors’ confidence is waning due to the unpredictable financial climate, leading to more sporadic market movements. At the same time, this increased volatility is attracting new traders seeking to learn about forex, as they seek to capitalize on price fluctuations.

The Russia-Ukraine war has impacted different regions according to their dependence on these two countries’ exports and supply routes. Besides Russia itself, Europe is the largest hit region by sanctions imposed on Russia, which provides approximately 35% of the European natural gas supply. Eastern Europe also faces a refugee surge, adding to financial pressures.

All of this is also adversely impacting the economically weak and socially delicate nations of the Middle East and North Africa. Even regions that are not directly influenced by this geopolitical conflict, like the U.S. and some Asian states, may face repercussions due to slower growth around the world and rising inflation.

According to Fidelity, although the Russia-Ukraine war is presently shaking up primary financial markets, economic damages are most likely temporary. At the beginning of the war in February, global stock markets nosedived, whereas the prices of gold, crude oil, and other safe-haven products rose sharply. The Dow Jones, S&P 500, and Nasdaq fell sharply, along with Russia’s RTS index, which shed 50% of its value.

However, these financial markets bounced back shortly after, regaining their initial value. This scenario indicates that there may not be a fundamental shift in the global outlook. Having said that, the investing environment as a whole will certainly be affected in the long run and be more affected by geopolitical events from around the globe.