European countries are facing a serious new shock as a result of the reduction of natural gas supplies from Russia, experts at Deutsche Bank (ETR:DBKGn) believe. In their opinion, this could further increase inflation in the region and push the eurozone’s largest economy, Germany, into recession.

“What has been unfolding in Europe in recent days is a major new supply crisis,” the bank’s analysts said, noting that the cut in gas supplies via Nord Stream reached 60% last month.

“If the problem of reduced supplies will not be solved in the coming days, it will increase the problems in the energy sector and will lead to serious consequences for economic growth, and of course, a significant acceleration of inflation,” – quotes the review of Deutsche Bank agency Bloomberg.

On the eve it became known that the German energy holding Uniper SE, losing about 30 million euros a day due to the need to replace Russian gas supplies with more expensive alternatives, is discussing with the authorities of the Federal Republic of Germany measures to support its business.

Chemicals group BASF SE (ETR:BASFN), which uses natural gas not only for power generation but also as a raw material for chemical products, earlier said it would be forced to cut production.

“A sustained gas shortage would increase the risk of an imminent recession in Germany due to the need to limit energy use,” Deutsche Bank said in a review. It would also be a “clear downward” signal for the euro exchange rate when paired with the US dollar, experts said.