The key facts

  • EU summit discusses energy prices, trade with China and the seven-year budget; a deal by year-end is in question
  • Kaja Kallas: US-Russia diesel deal is a 'gift to Putin'; strikes on refineries are legitimate defense
  • Zelensky feels 'betrayed' by Trump; FT: the US proposed transferring frozen Russian assets under Washington's control — the EU rejected it

Energy and Budget at the Center of the Summit

EU leaders opened a two-day summit in Brussels with a discussion of energy prices, which have risen sharply amid the fighting in the Middle East. Oil remains above $100 per barrel despite the coordinated G7 stockpile release, and the IEA warned that Europe could face a new surge in wholesale diesel prices. Italy and Greece are calling on Brussels to loosen fiscal rules by allowing 'temporary and targeted measures', but more conservative countries warn of risks to deficits and market volatility. The sharpest point will be the next seven-year EU budget: the 'frugal' camp versus supporters of increasing the budget, and the compromise proposed by Ireland satisfied neither side. European Council President António Costa wants an agreement by the end of the year to finish legislative work by January 2028, but diplomats note a lack of readiness to compromise; Pedro Sánchez's sudden decision to call early elections adds uncertainty. One senior diplomat said: 'We are not in a hurry. We need a good deal.'

China and the Trade Deficit

Leaders will also discuss the growing trade deficit with China — a week after European Commissioner Maroš Šefčovič reached a preliminary agreement on restricting imports of Chinese hybrids and access to rare earth metals. France and Germany proposed a 'kill switch' — cutting off China's access to the EU market if the deficit remains unsustainable.

Kallas: 'A Gift to Putin'

EU High Representative for Foreign Affairs Kaja Kallas called the report of a US-Russia diesel deal a 'gift to Putin' and confirmed that, under international law, Ukraine's strikes on Russian refineries constitute defense: 'The main point is that Russia must stop this war. Most of the war's funding comes from oil.'

Zelensky on 'Betrayal' and Starlink

Volodymyr Zelensky, who will join the summit on Thursday, said in an interview with Piers Morgan that Ukraine is losing US support and feels 'betrayed' by Donald Trump: 'It hurts when President Trump picks a side — and not ours.' He also called the Starlink outages a 'big mistake', warning that 'people will die' if the service is not restored. Ukrainian military confirmed a speed cap of about 160 km/h on the military Starshield, which affected drone operations. By evening, connectivity had stabilized, but the speed cap remained; Mykhailo Fedorov publicly thanked Elon Musk, though Musk pointed out that Starshield is controlled by the US government, with decisions made by the American military and ultimately the president.

Frozen Assets and Other News

According to the FT, American negotiators at a meeting in Miami proposed that Europeans unfreeze part of the immobilized Russian state assets and place them in a financial mechanism under Washington's control to unlock peace talks; the Europeans rejected the plan. At Thursday's summit, the question of providing the assets to Ukraine as a loan will be raised. Leader of France's National Rally Marine Le Pen in Brussels demanded limiting the European Commission's powers, capping France's net contribution to the EU budget at €5 billion per year, and said France cannot continue financing Ukraine due to the state of the economy — 10-year bond yields have risen 100 basis points since the start of the year. In addition, MEPs are calling to activate the Blocking Statute to protect the ICC from American sanctions, while the European Commission proposed a one-year delay of methane rules, drawing criticism from environmentalists.