Peace is traditionally seen as the ultimate goal of diplomacy and civilization. Yet in the current geopolitical climate, peace with Russia could paradoxically cost Europe more than war itself. The idea may sound counterintuitive, but when examined through the lenses of finance, energy, and global power, it reveals a complex and uncomfortable truth.
To end the war in Ukraine on negotiated terms, Europe would likely need to return the €300 billion in frozen Russian assets, lift major sanctions, and abandon its ambition of a regime change in Moscow. These steps, however, would not come cheap. Beyond the moral and political implications, they would reshape the European economy — reducing industrial competitiveness, increasing the cost of raw materials, and exposing the continent to new strategic vulnerabilities.
In essence, the “cost of peace” is not only measured in money, but in lost leverage, structural weakness, and diminished geopolitical influence.
1. The Dollar Value of War: How Sanctions Became the Core of Europe’s Strategy
Since 2022, the European Union has been locked in a full-scale economic war of attrition with Russia. Alongside the United States, the EU froze hundreds of billions of Russian assets, imposed more than 14 rounds of sanctions, and allocated over €177.5 billion in combined military, humanitarian, and financial aid to Ukraine.
The sanctions were never merely punitive: they were meant to reshape global trade and to limit Russia’s ability to wage prolonged war. Freezing Russian assets was the ultimate expression of this new economic warfare — a form of “financial deterrence.”
However, what was initially seen as a strategic triumph is turning into a long-term economic burden. If peace negotiations required Europe to unfreeze or even compensate for these assets, the financial and political cost could be astronomical.
2. The Cost of War for Europe: Measurable but Manageable
To understand why peace could be costlier, one must first consider the real cost of war for Europe.
The Kiel Institute for the World Economy estimates that European economies will collectively lose around $70 billion in output by 2026 due to disruptions caused by the war — including higher energy prices, disrupted supply chains, and inflation.
Yet these are, paradoxically, manageable losses. They are distributed over time and partially offset by other effects: increased defense spending, industrial innovation, and closer transatlantic ties.
According to The Guardian (February 2025), the EU spent €21.9 billion on Russian oil and gas in a single year, while allocating €18.7 billion in direct aid to Ukraine. The paradox is obvious: Europe continues to pay Russia even as it funds Ukraine.
Still, this structure allows Europe to maintain control over timing and leverage. The cost of the war, though high, buys influence — while the cost of peace could mean surrendering it entirely.
3. Why Peace Could Be More Expensive
a) The Return of Frozen Russian Assets
A peace agreement that includes the return of €300 billion in frozen Russian assets would instantly burden European economies. Such a sum represents not only lost leverage but also a symbolic defeat: the West’s most powerful financial weapon would be neutralized.
Moreover, returning these assets could trigger political backlash inside the EU. Many governments would face criticism for transferring enormous wealth to Moscow right after years of sanctions, effectively legitimizing Russian aggression.
b) Loss of Economic Leverage
The EU’s sanctions architecture — control over SWIFT transactions, banking restrictions, export bans — has become its most potent tool of coercion. Abandoning it in exchange for an uncertain peace would strip Europe of its ability to deter further Russian aggression.
c) Higher Raw-Material and Energy Costs
Contrary to the common expectation, a quick peace would not immediately lower prices. On the contrary, it could create a new asymmetry: Russia would resume energy exports on its own terms, setting higher prices or favoring Asian partners. Europe, having dismantled its pressure tools, would have no choice but to accept those terms — re-importing dependency.
d) Industrial Competitiveness and Strategic Autonomy
War has accelerated Europe’s move toward energy independence, defense integration, and technological self-reliance. A premature peace could reverse this process, undermining the continent’s long-term industrial competitiveness.
Without the urgency of conflict, investment in renewables, microchips, and defense innovation could stall — leaving Europe technologically behind the U.S. and China.
e) Strategic Risk and Future Instability
Finally, a peace that restores Russia’s financial freedom without altering its behavior could sow the seeds of future conflict. A resurgent Russia, flush with recovered assets and energy revenue, could rebuild its military capacity faster than Europe can consolidate its defenses.
4. Counting the Numbers: The Price Tag of a “Peace Deal”
Between 2022 and 2024, according to the European Parliament, the EU and its member states mobilized over €88 billion in official support for Ukraine — rising to €130 billion when including refugee and reconstruction aid.
By contrast, returning even a fraction of €3 trillion in frozen assets would dwarf all those numbers combined. Such an operation would force European governments to cut spending, raise taxes, or expand debt at a time of economic stagnation and social discontent.
That is why economists often speak of a “peace shock” — a sudden reallocation of resources that could trigger recessionary effects across the Eurozone.
5. Europe’s Strategic Dilemma: Three Possible Scenarios
Scenario A – A Negotiated, Conditional Peace
Europe keeps part of its sanctions, conditions asset returns on Russian behavior, and secures guarantees on energy pricing. This scenario has a high short-term cost but preserves leverage and credibility.
Scenario B – A Rapid Peace on Russian Terms
Europe unfreezes assets, lifts sanctions, and normalizes relations quickly. The immediate result: financial burden, rising energy costs, loss of industrial competitiveness, and geopolitical weakness. This is the most expensive form of peace, both economically and strategically.
Scenario C – A Prolonged “Frozen War”
The conflict continues in a limited form. The EU bears ongoing costs but maintains control, influence, and long-term strategic options. In this sense, war becomes the cheaper alternative to a premature peace.
6. Sectoral Impacts on Europe
Energy and Raw Materials
Europe’s partial decoupling from Russian gas has diversified its sources but increased costs. A quick peace would not necessarily reverse this — Russia could exploit its regained position to dictate prices. The energy market would remain volatile, with Europe still at a disadvantage.
Industry and Competitiveness
Higher energy prices and supply-chain uncertainty have already weakened Europe’s manufacturing base. Peace without strategic reforms would make this permanent. China and the U.S., both benefiting from cheaper energy and state-backed industries, would outpace Europe in key sectors like automotive, green tech, and defense.
Public Finance and Debt
Returning frozen assets worth trillions would require unprecedented fiscal measures. Governments might need to issue new debt, increase taxation, or slash spending in social welfare and infrastructure — eroding public trust and fueling political extremism across the continent.
7. The Paradox of Peace
In the classical sense, peace is supposed to bring prosperity and stability. But for Europe in the 2020s, the paradox of peace is that it could bring the opposite: instability, inflation, and financial strain.
As long as the war continues, Europe retains a set of tools — sanctions, control over energy trade, strategic alignment with the U.S. — that preserve its influence. A sudden peace could dismantle that entire framework, leaving the EU weaker both economically and geopolitically.
Peace, therefore, is not automatically cheaper. It depends on who defines the terms — and right now, those terms might favor Moscow, not Brussels.
8. A Question of Leverage and Time
From a realist perspective, Europe’s greatest weapon is time. The longer the EU sustains coordinated sanctions, the more Russia is forced to rely on China, depleting its strategic autonomy.
Conversely, a quick peace would hand Russia financial relief and political legitimacy.
In the words of several European strategists, “the war is costly, but the wrong peace could be catastrophic.”
9. The Economic Lessons of War and Peace
The last three years have taught Europe that economic sovereignty is national security. The war accelerated trends that peace might reverse:
– energy diversification,
– digital innovation,
– defense cooperation,
– reduced dependency on authoritarian suppliers.
If peace undermines these gains, the long-term economic cost will far outweigh the short-term relief.
In other words, the war may be an investment in Europe’s strategic future, whereas a premature peace could lock the continent into a new cycle of dependency and weakness.
10. Conclusion: The Price of Survival
The European Union stands at a crossroads. On one side lies a prolonged conflict that drains resources but preserves influence; on the other, a peace that restores normality yet strips away economic and political leverage.
If ending the war means returning €300 billion in Russian assets, accepting higher raw-material prices, and conceding geopolitical ground, then the “cost of peace” is not just financial — it is existential.
Europe’s leaders must therefore ask: Is peace at any price truly peace? Or is it simply the beginning of a new economic subordination?
In the 21st century, wars are no longer fought only with armies, but with currencies, sanctions, and supply chains. And in this battle for global influence, Europe may discover that maintaining pressure — even at a high cost — is cheaper than surrendering its strategic autonomy.
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This article explores how peace with Russia could impose heavier economic, political, and strategic costs on Europe than the ongoing war, focusing on frozen assets, lost competitiveness, and the future of European sovereignty within a changing world order.
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A deep geopolitical and economic analysis explaining why peace could be more expensive for Europe than war — from the return of €300 billion in frozen Russian assets to Europe’s loss of competitiveness and rising raw-material costs.
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Europe Russia war, cost of peace, frozen Russian assets, European competitiveness, energy crisis, sanctions on Russia, EU economy, geopolitical order, war economy, new world order.