El Niño Threatens Trillions of Dollars in Damage. Which Countries Will Suffer Most

Author and Editor-in-Chief: Vitaliy Kisterny30.08.2026 13:40:00

The anomalous warming of Pacific Ocean waters, known as El Niño, threatens the global economy with losses in the trillions of dollars. It is already triggering a logistics crisis in the Panama Canal.

According to data from The Wall Street Journal and research by climatologists, the main blow will fall on tropical countries.

At present, ocean temperatures continue to break historical records.

Photo: © Belnovosti / US dollars. Author Vitaliy KisternyClimatologists are raising the alarm: the current climate cycle is ceasing to be merely a weather anomaly, transforming into a full-fledged macroeconomic factor. According to estimates by researcher Christopher Callahan of Indiana University, the consequences of the current El Niño could prove "serious enough" for global GDP, leading to income losses in the trillions.

The most vulnerable are economies located in the tropical belt, where the connection between ocean temperature and labor productivity is most direct.

However, financial losses are only the tip of the iceberg. The WSJ publication draws attention to very tangible consequences for global trade already happening now. This concerns the Panama Canal — a key artery connecting the Atlantic and Pacific Oceans.

Due to the anomalous drought triggered by changes in climate patterns, water levels in Lake Gatun, which feeds the canal's locks, have critically declined. The canal administration was forced to impose strict restrictions on the number of passing ships.

The result was not long in coming: whereas previously the standard price for transit was around $800,000, now, amid a shortage of slots, rates have soared to $2.5 million per passage. This will inevitably affect the cost of transported goods.

It is worth noting that the current intensity of the phenomenon is no accident. The press service of the University of Michigan previously reported that over the past forty years, the strength of El Niño has increased by 40%, bringing it to peak values for the current millennium.

To understand the nature of what is happening, it is worth recalling that El Niño (translated from Spanish as "the boy") and its "sister" La Niña ("the girl") represent fluctuations in the temperature of the upper layers of water in the equatorial part of the Pacific Ocean. While La Niña brings cooling, El Niño, on the contrary, is associated with a sharp warming of the water.

This seemingly local temperature fluctuation triggers a chain reaction in the atmosphere: wind and ocean current patterns shift, leading to droughts in some regions and devastating floods in others. A striking historical example is Australia's "millennium drought," which lasted from 1996 to 2010 and was only ended by the arrival of a new La Niña phase.

Now, as ocean waters continue to warm against the backdrop of overall global warming, national economies are having to learn to reckon with losses not only from hurricanes, but from the very fact of the existence of climate cycles amplified by human activity.

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