Potential Global Economic Consequences of Russia's Use of Nuclear Weapons in Ukraine

Key Chapter Title List

1. Core Conclusions
2. Scope of Applicability Statement
3. Financial Stability at Risk
4. Worsening Food Insecurity
5. Further Damage to Economic Growth
6. Multiple Factors That Could Amplify Global Economic Impact
7. Reduction in Russian Agricultural Exports
8. Food Export Bans
9. Metal Price Volatility
10. Further Reduction in Russian Energy Exports

Document Introduction

This memorandum was prepared at the request of the National Security Council (NSC) to explore the potential global economic impacts of Russia using one or more nuclear weapons in Ukraine. It was led by the National Intelligence Officer for Economic Affairs and drafted by the National Intelligence Council, completed in November 2022, and declassified by Director of National Intelligence Haines on September 22, 2024.

The report's core assessment states that Russia's use of nuclear weapons in Ukraine would further exacerbate existing vulnerabilities in the global economy, increasing economic pressure on countries already facing high inflation and high economic risks. Risks to financial stability and food security are highly likely to rise, economic growth will slow further, some countries may fall into recession, while volatility in financial markets and commodity markets (including energy markets) will intensify, inflation will remain high, food insecurity will worsen, and countries' ability to maintain financial and political stability will face greater challenges.

Regarding specific impact dimensions: In the financial sector, demand for the US dollar as a safe-haven asset will drive its appreciation, debt repayment pressures on emerging market countries will surge sharply, and some countries already on the brink of or experiencing financial crises may move towards debt default. In the food sector, concerns over potential radiation contamination of Ukrainian agricultural products, disruptions to Black Sea port shipping, and rising costs will lead to higher global food prices, greater inflationary pressure on food-importing countries, and a worsening of global food insecurity. In terms of economic growth, global growth expectations will be further downgraded, multiple countries may fall into recession, and some economies like the UK and Japan are already showing signs of economic contraction.

The report also points out that multiple factors could amplify the aforementioned economic impacts, including chain reactions such as reduced Russian agricultural exports, food-exporting countries implementing export bans, metal price volatility, and further reductions in Russian energy exports. Due to uncertainties surrounding key variables such as the scale of nuclear weapon use, its impact on the course of the war, and the response measures of US and Western allies, as well as the lack of historical precedent for reference, the report's predictions regarding the duration and severity of economic disruption have low confidence.