The long-term and so-called temporary supply of gas from Russia would have a significant negative impact on the growth trend and the budget indicator of the Czech Republic, the agency said. She pointed out the high dependence of the Czech Republic on gas supplies from Russia in combination with the limited possibilities of their replacement in the near time horizon.

It should be noted that Russia has significantly reduced gas supplies to the European Union in recent weeks, and several EU countries have noticed that gas supplies from Russia will be completely stopped or severely limited.

Another, which we pay for the eight years of rule (thanks to Prime Minister) Andrej Babia. Moody’s agency confirmed the high R rating, but downgraded the outlook due to R’s strong energy dependence on Russia, Finance Minister Zbynk Stanjura wrote on Twitter. We know that (Russian President Vladimir) Putin will use gas and oil as weapons, the priority is the de-Russification of Czech and European energy, he added. Russia attacked neighboring Ukraine in November, and after the EU country Kyiv clearly supported its defense, Moscow began to reduce its gas supplies to Europe, in some cases even stopping them completely.

Moody’s agency has revised its forecast for gross domestic product (GDP) growth to 2.3 percent for this year and one percent for 2023. The two forecasts from November 9, i.e. before the Russian invasion of Ukraine, fell with growth of 3.5 percent for 2022 and 3.2 percent for 2023.

According to Moodys, the Czech Republic will probably reach the pre-pandemic level of GDP this year. Compared to the rest of the EU, it is later, or 17 out of 27 EU countries were at the pre-pandemic level last year.

The main reasons for disappointing GDP growth forecasts for the Czech Republic are rising energy costs and uncertainty about the supply of energy from Russia, which stifles business investment. Another factor is the non-original rate of consumer price inflation, which reduces private consumption. This weakens the outlook for growth of the Czech Republic’s main trading partners, especially Germany.

On Thursday, the Czech National Bank increased the growth estimate of the Czech economy for this year to 2.3 percent from 0.8 percent, which it stated in the previous May forecast. For the fifth year, GDP growth was 1.1 percent, so far it was 3.6 percent.

In the event of a full and long-term supply of Russian gas in the near future, the Czech Republic would be at risk of its production. This would plunge the economy into the depths of recession, according to Moodys.

The reserve for the nearest period would be provided by the gas reservoirs, which were 79 percent full on August 2, 2022, which represents 38 percent of the annual consumption. In the EU, gas storage tanks were 71 percent full on the same date, which represents 19 percent of consumption, the agency noted. According to him, priority would be given to households and critical infrastructure in the long run. The industrial sector would thus find itself in a vulnerable position.