The war in Ukraine has one specific feature: its allies—the US, the UK, and the European Union—have been asserting their moral superiority for two years, but in practice they have opted for caution.
Instead of deploying their own troops, they resorted to sanctions, export controls, and diplomatic gestures designed to deter Moscow while placing as little strain as possible on their own political and fiscal budgets. However, this approach has its limits.
With the arrival of Donald Trump, the cards have been reshuffled. And, unfortunately, as expected, Europe has been dealt a very weak hand this time around. Trump has ensured that American taxpayers will not give another dollar to Ukraine. What's more, the American economy will benefit from this, because all American weapons supplied to Ukraine will be paid for by Europeans.
Even the costs of running the state
Trump did exactly what he promised in his election campaign. He left the baby named Ukraine with the Europeans. They now have to take care of it. And that means not only paying for the war, but also taking full responsibility for the day-to-day running of the Ukrainian state.
The International Monetary Fund estimates that Ukraine will need around $65 billion (€55 billion) to operate until the end of 2027. However, this estimate does not include military costs of $120 billion (€102.5 billion). On October 23, 2025, the European Council committed to continuing to provide financial support to Ukraine for its functioning and military efforts.
If the war continues at the same intensity for another two years, then according to this estimate, Europe would have to take roughly $185 billion out of taxpayers' pockets during this period. That is a huge amount.
To give you an idea: at its October meeting, the European Council estimated the EU's aid since the start of the open conflict at €177.5 billion. These two figures clearly show the dead end that the EU and its leadership are heading towards. If it is indeed forced to assume the main financial commitment to Ukraine in 2026, it would have to spend approximately the same amount in half the time as it has provided for the entire duration of the war to date.
This is economically impossible. Therefore, the only realistic option remains to borrow to continue the war.
An attractive but impractical option: assets
The idea of obtaining money from frozen Russian assets is extremely attractive to European politicians. However, it soon became clear that this option is practically unfeasible. Belgium, where Euroclear, the company that manages most Russian assets, is based, fears retaliatory measures from Russia.
It would be difficult for the European side to win an international arbitration case. Belgium would face the risk of bearing the costs of the dispute, including interest for its entire duration. Simply seizing and using Russian assets is therefore not possible.
What needs to be made clear from the outset is that the European Union cannot sell frozen Russian assets on the market and then send the money to Ukraine. Such a move was never even considered. In the European mindset, these Russian assets have become an expected part of the war reparations that the bear country will be forced to pay Ukraine as part of a possible peace agreement.
It sounds nice, but the reality is quite different. The terms of surrender are not determined by the defeated, but by the victors. As we will see, European officials have gradually realized that considering frozen assets as certain Russian reparations is extremely risky. The problem is not whether it is technically possible to seize them, but who will bear responsibility if the situation develops differently.
For example, if, after the conclusion of peace between Ukraine and Russia, these resources had to be returned to Russia. It is not realistic for member states to provide such a guarantee. Hungary and Slovakia have strongly opposed a joint European loan. As this is an extremely important decision, it would have to be adopted unanimously. And that is no longer possible today.
Even the European Central Bank (ECB) has turned away from the proposal and refused to provide any guarantees. The ECB's reasoning was curious, pointing out that it would violate its rules on lending to individual states. This regulation has often been "forgotten" in recent history.
The ECB's position thus clearly signals a change in thinking even in these key institutions. A year ago, such a guarantee would probably have been accepted. However, central bankers are aware of the risks. And the risk that Ukraine will lose or will not be able to dictate the terms of peace is too high in their eyes.
A drowning man will clutch at a straw
However, the European Union is not giving up. Ukraine desperately needs money, and at this point, only the Union itself can provide it. The European Commission has therefore presented two solutions to Ukraine's financial needs for the period 2026 to 2027: a classic EU loan and a so-called reparations loan.
Both proposals will be discussed at the European Council meeting on December 18 and 19. The entire plan is almost 90 pages long. The key sentence of the entire document is: "These cash balances are not the property of the Central Bank of the Russian Federation and do not enjoy sovereign immunity."
European officials have thus found a loophole in the form of cash balances, i.e., interest and newly generated cash. The original frozen assets remain untouched, so Russia cannot formally defend itself. In reality, however, trade with Russia continues and new balances are accumulating in the accounts. It is these that should be used. The solution is reminiscent of the classic fairy tale about how the wolf got fed and the sheep remained intact.
Even if we admit that this approach is legally, politically, and geopolitically feasible, a practical problem remains. It is highly unlikely that the new balances will approach the volume of the original frozen assets. Trade with Russia continues, but on a much smaller scale.
It is estimated that approximately €60 billion could be used in this way. Even in this case, however, the European Union would still be short of around €100 billion for the next two years of the war. This can only be explained by the fact that Brussels is counting on an early end to the fighting and that it will only have to cover the costs of Ukraine's day-to-day operations.
In the opposite scenario, this will not be enough. The European Union will therefore have to dig deeper into the pockets of its member states. And that is where the big problem lies. Public support for Ukraine is no longer as strong as it was at the beginning. In addition, most member states are struggling with high budget deficits. Further massive aid to Ukraine will inevitably mean less money for their own citizens. Equally important, the latest corruption scandals provide strong arguments to all those who criticize the transfer of money to Ukraine without sufficient control.
Europe is once again proving that it can come up with elegant and sophisticated solutions, but only until it comes up against reality. A drowning man will clutch at a straw, and cash balances are just another straw, albeit a thin one this time. If the war drags on, the EU will have to look in the mirror and admit that solidarity with Ukraine is not a matter of clever legal tricks, but of political courage and real money that someone will actually have to pay.