Anu Gaggar, global investment strategist for Commonwealth Financial Network, joined Cheddar News to discuss how global supply chains could be disrupted even further by an armed conflict in Ukraine.

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Russian Invasion of Ukraine Would Have Wider Geopolitical Implications

for more on this. We're joined by a new gag. Our global investment strategist for commonwealth financial network, a new we're gonna jump right into this tensions in Ukraine show no signs of easing. But first, how significant of a move is this deployment by the biden administration? Good morning, Ariel. And thank you for having me. Uh, so you're right. The there are no signs of abatement in any of these tensions and uh, 3000 troops were deployed yesterday. Bear in mind that there's only really 2000 additional troops, 1000 of just being repositioned from Germany to Romania. Uh, so it is a sign that we are supporting NATO allies were not engaging for us is not engaging in war. So we are not going to Ukraine not engaging in actual war if it does happen. But we are there to support our allies and Russia at this point, it's really not showing any signs of de escalation. Does that put Russia on the offensive? And should the U. S. Really expect a response here, You're right, there's about 100,000 troops from Russia that are on Ukrainian border. So they are not backing off. But hopefully diplomatic conversations are still on and hopefully cooler heads prevail in the end. Now, what's interesting here is that Russia is the world's largest exporter of natural gas and the second largest exporter of crude oil? What would be, you know, the broader applications of this, uh, this invasion on the global economy. Would you think that this could have a big impact on the supply chain crisis that we're currently in. Yes, you're right, So Russia is a major player in the energy markets? It's actually also a very big player uh in the commodity markets, especially in grains such as wheat and barley and corn, and also in sunflower seeds, grape seed, a lot of important medals. So if the situation does not deescalate, what we're really watching is the impact on the asset prices and asset markets, uh Russia supplies about a third of european uh energy, uh it also supplies between between Russia and Ukraine, they supply a quarter of the world's grains. So if situation escalates and these supply chains get disrupted, then that could be a major impact on energy prices and on uh grain prices. Now, I don't expect much of an uh you know, disruption to energy supplies, just because it's a lose lose situation for everyone, europe is already dealing with very tight supplies of energy. So, uh they would not want to be, you know, to amplify these tensions, but also for Russia, about a third of Russian budget, uh you know, spending comes from energy revenues, so they would not want to disrupt those uh you know, pipelines as well, if a Russian invasion does happen, it just appears that so many uh things are really endangered here from the energy to uh you know, the the seeds grains and seeds things that we don't necessarily think of or things that we kind of take for granted here, would you say that global markets are just waiting to see what happens next at this point? And, you know, how would this affect the global economy if certain certain things are uh, imminent at this point? Well, it is important to remember that geopolitical tensions are always simmering, There's always something going on. And uh, in the larger scheme of things, except for uh, you know, some extreme circumstances, asset markets generally take them in their stride. So in the near term, there could be some impact, especially for Asset markets in that region. We've already seen that in the Russian equity, fixed income and currency markets. But if you just look back historically, if you look at the Crimean crisis in 2014, Russian equity prices tend, but then they rose quite quickly. But at the same time, european equities and MSC I act with. They just kept chugging along, Thank you so much for joining us this morning. A new gag. Our global investment strategist for commonwealth Financial network. Thank you once again