Trump’s latest moves against Russia present Ukraine with new war dilemma

Ukraine faces growing uncertainty over its ability to sustain the war against Russia, as a series of moves by U.S. President Donald Trump has raised new questions about Washington’s reliability as kyiv’s most important military partner.

Trump and Putin’s deal to ease sanctions on Russia for supplying global markets with diesel, as well as restrictions on sharing U.S. intelligence with Ukrainian forces, have put President Volodymyr Zelenskyy in a difficult position as winter approaches.

Rising prices for diesel – essential for transporting goods and agricultural production – tend to drive up costs across the economy and fuel inflation. As the US midterm elections approach in November, Trump is under pressure to cut fuel prices.

But experts told CNBC that the diesel deal would bring only a marginal financial benefit to Russia and would do little to change global energy prices. Its broader political implications could be more significant, potentially strengthening the Kremlin’s belief that it can extract concessions from Washington without compromising on Ukraine.

“Russia’s main gain is political: Trump’s decision eases sanctions pressure and undermines Western unity,” Sergei Aleksashenko, senior researcher and head of economics at the NEST Center, told CNBC.

Trump’s deal with Putin called for Russia to supply the global market with 4.8 million tons of diesel, the equivalent of about ten days of U.S. domestic demand, or about a single day of global demand. Experts say this will have little impact on prices.

“It doesn’t even touch the sides — it’s very, very small,” Neil Atkinson, former head of the IEA’s oil industry and markets division, told CNBC’s “Squawk Box Europe” on Monday.

Aleksashenko estimated that the first part of the phased deal, which covers 1.8 million tonnes of diesel, could generate up to $1.25 billion in additional export revenues over three months, equivalent to about 1% of Russia’s raw materials export revenues during that period.

However, the benefit to the Russian federal budget would be significantly smaller, at less than $30 million per month, or less than 0.07% of monthly federal revenues.

This deal is therefore unlikely to significantly strengthen Russia’s war finances, Mr Aleksashenko said. Instead, its main benefit for Moscow is political, as it has eased sanctions pressure and undermined Western unity without forcing Putin to make concessions on Ukraine, he told CNBC.

The researcher also argued that the additional arrival of Russian diesel in global markets is not enough to produce a notable reduction in consumer fuel prices in the short term.

“War financing is currently Putin’s priority, and he is ready to increase this financing even if it means cutting all other spending,” Aleksashenko added, referring to Russia’s proposed budget for 2027.

“Rather than encouraging compromise, the (diesel) deal likely reinforces Moscow’s belief that continued pressure will eventually result in further Western concessions,” Maria Snegovaya, a senior fellow at the Center for Strategic and International Studies, told CNBC.

Speaking to reporters Friday in Brussels, Zelensky also warned that the diesel deal could set a precedent for further sanctions relief, while highlighting Ukraine’s continued reliance on U.S. military technology and intelligence despite efforts to develop alternatives.

“Sanctions will be lifted after gas,” Zelensky said. “They will be lifted on something else. Then it will come to the banking system, to certain individuals, to the chemical industry.”

Earlier this week, reports emerged that SpaceX Starlink military app Starshield has been restricted in Ukraine. SpaceX CEO Elon Musk said in an article on X that the US government and president are ultimately responsible for any restrictions placed on the network.

The order to limit Starshield for Ukraine came from the White House, according to a Reuters report citing three officials familiar with the matter. CNBC has contacted the White House for comment.

The consequences were felt hard in Ukraine. As Starlink’s speed limits were lowered, Ukraine became unable to shoot down some Russian drones. This week, Ukraine also did not receive advance warning from its partners about the arrival of ballistic missiles, leading to civilian deaths, according to Ukrainian officials.

According to Serhiy Derkach, Ukraine’s first deputy minister for recovery, infrastructure and transport, Starlink’s restrictions have emboldened Russia to step up attacks against Ukraine.

“As the United States limits the use of Starlinks on the battlefield, Russia believes the time has come to try to inflict even more pain and suffering on Ukraine’s civilian infrastructure,” Derkach told CNBC on Friday.

Russian authorities did not respond to multiple requests for comment from CNBC.

The diesel deal was a political and moral blow to Ukraine and the Western coalition, according to Snegovaya. The exemption from US sanctions, which applies until April 2027, could facilitate Russian diesel exports beyond the initially announced shipment, potentially increasing Moscow’s economic gains, she warned.

“If (the) White House uses its military and intelligence support as leverage to limit Ukrainian strikes, the consequences could become much greater,” Snegovaya said, adding that Ukrainian attacks on Russian oil refineries have inflicted substantial economic costs on Moscow.

Such a move could have far more serious consequences for Ukraine’s efforts to weaken Russia’s war economy, she added.

The diesel deal further undermines Washington’s credibility as a mediator in the eyes of Ukraine and its European allies, as it appears to reward Moscow without securing concessions while increasing pressure on kyiv, she said.

The problem, Snegovaya said, is that it is extremely difficult to achieve military autonomy for Europe and Ukraine in the short term, and Europe has been slow to develop the necessary capabilities.

“Nearly five years into the war, Ukraine and its European partners remain heavily dependent on the United States in critical areas, such as intelligence and missile defense. These dependencies are unlikely to be overcome during the remaining years of the Trump administration,” she told CNBC.