Russia Heat Wave May Kill 15,000, Shave $15 Billion of GDP

Russia’s record heat wave may already have taken 15,000 lives and cost the economy $15 billion as fires and drought ravage the country.

At least 7,000 people have probably died in Moscow as a result of the heat, and the nationwide death toll is likely to be at least twice that figure, according to Jeff Masters, co- founder of Weather Underground, a 15-year-old Internet weather service that gathers information from around the world.

“The Russian population affected by extreme heat is at least double the population of Moscow, and the death toll in Russia from the 2010 heat wave is probably at least 15,000, and may be much higher,” Masters said late yesterday on his blog.

Prime Minister Vladimir Putin took to the air today to douse a forest fire south of Moscow. The heat wave may slice 1 percent off of Russia’s $1.5 trillion economy this year because of lower agricultural output and reduced activity in other areas such as industry, Alexander Morozov, chief economist at HSBC Holdings Plc in Moscow, said in an e-mail today.

Russia may harvest a third less grain than last year because of drought, Putin said yesterday. Companies such as automaker OAO AvtoVAZ have curbed production, and restaurants in Moscow are seeing a decline in customers as residents avoid smoke from wildfires that is blanketing the city.

Putin, 57, is leading government relief efforts, banning grain exports until the end of the year and traveling to the worst affected areas. State television showed him in the cockpit of a Be-200 firefighting plane today as it scooped up water from a river to extinguish two fires in the Ryazan region.

Moscow Smoke

In the Moscow region, planes are unable to fight fires because of thick smoke. Aircraft are on stand-by for when the air clears, Rossiya-24 television reported. The capital broke another record today when the temperature reached 32.8 degrees Celsius (91 Fahrenheit).

While the official death toll from fires in central Russia is 52, the heat and smoke in Moscow have almost doubled the city’s normal death rate to about 700 a day, Andrei Seltsovsky, head of the city’s public health department, said yesterday in a televised news conference.

Masters, who has a Ph.D. in air pollution meteorology, used those numbers to calculate a nationwide death toll. As many as 50,000 people died during a European heat wave seven years ago, he said.

“I expect that by the time the Great Russian Heat Wave of 2010 is over, it may rival the 2003 European heat wave as the deadliest heat wave in world history,” Masters wrote on his Ann Arbor, Michigan-based website.

‘Overall Slowdown’

Russia’s 2010 economic growth may slow to 7 percent from 7.5 percent because of a smaller grain harvest, reduced exports and lower consumer demand as inflation accelerates, Zurich-based UBS AG said yesterday.

“Current weather conditions are likely to adversely affect the services sector, and we may see an overall slowdown in economic activity in August,” Anton Nikitin, an analyst at Renaissance Capital in Moscow, said in an e-mailed note.

No rain is expected for at least the next week, Rossiya-24 reported. Those conditions may lead to new fires in the Moscow region, one of the worst affected areas, the broadcaster said.

Fires across central Russia have destroyed at least 2,000 homes and scorched almost 750,000 hectares (2,900 square miles), according to the government.

Reconstruction Begins

Construction of houses for people who lost their homes in the Voronezh and Lipetsk regions has begun, according to Rossiya-24. The station showed video cameras being set up at construction sites after Putin said last week that webcams should be installed so he and the public could monitor the work.

Putin met today with Moscow Mayor Yury Luzhkov, according to the government website. The prime minister suggested the city help rebuild housing in badly affected regions.

Luzhkov, who broke off his vacation Aug. 8, should have returned to the city earlier to take charge of the situation, an unidentified official in President Dmitry Medvedev’s administration told Interfax. The mayor, one of Russia’s longest serving politicians, is often at loggerheads with the federal government.

To contact the reporters on this story: Lucian Kim in Moscow at lkim3@bloomberg.net; Maria Levitov in London at mlevitov@bloomberg.net

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