Bugajski for The Geopost: War turning in Ukraine’s favor

Editorial by Janusz Bugajski for The Geopost

Despite the grim predictions at the start of the year, there is growing evidence that the war is turning to Ukraine’s advantage. Although armed conflict is unlikely to end in the coming months, by the close of 2025, Ukraine will be better armed while Russia’s weaknesses and domestic vulnerabilities will become more exposed.

Russia has failed to win on the diplomatic front. The U.S. administration has vented its frustration with Kremlin rejections of a ceasefire and will no longer mediate peace talks. It will only engage if Moscow and Kyiv negotiate bilaterally – a highly unlikely scenario. In reality, Washington’s withdrawal from the peace talks will favor Ukraine, as it removes White House pressure on President Zelenskyy, exposes Russia as the aggressor, sidelines talk of partitioning Ukraine, and allows Kyiv to bomb military and energy targets in Russia without restrictions.

Diplomatically, Zelenskyy is emerging as a winner, in relations with both the U.S. and Europe. What was initially viewed as President Donald Trump’s abandonment of Ukraine is now seen as a negotiating process in which both Washington and Kyiv benefit. Ukraine and the U.S. have signed a strategic trade deal, including the mining of rare earths and fossil fuels, in exchange for American investments and weapons. Trump appears happy with the arrangement whereby U.S. companies gain priority access to aluminum, titanium, lithium, graphite, natural gas, and oil. Ukraine possesses about 5% of the world’s critical materials needed for the manufacture of weapons and electronic systems.

In return, Kyiv will receive stronger military and financial backing against Russia. A Joint Reconstruction Investment Fund will be established and equally co-managed, while Washington’s future military assistance will be considered a financial contribution to the fund. Although Ukraine will not receive security guarantees from the White House, the resource agreement specifies the recognition of Ukraine’s sovereignty, underscores Russia as the aggressor, and gives the U.S. a major stake in Ukraine’s economy and reconstruction. It also prohibits any state or company that fueled Russia’s war against Ukraine from benefiting from the fund or from multi-billion dollar reconstruction plans for Ukraine.

European countries have stated their determination to significantly increase their financial and military assistance to Kyiv to about 0.2% of GDP. They were spurred into action by the uncertainty of continuing U.S. assistance. In absolute terms, the role of the largest European countries, such as Germany, the UK, and France, and the European Investment Bank will prove decisive. Europe as a whole needs to increase its yearly aid flow from the current €44 billion to €82 billion. Financial incentives can be afforded to countries giving most aid to Ukraine, with the biggest donors gaining priority access to any new EU-level defense financing schemes. Aid for Ukraine could also be deducted from each state’s contributions to the EU budget.

European military assistance, estimated at $53 billion thus far, has included the supply of air-defense systems, tanks, fighter jets, and ammunition. European countries are also boosting their defense industry capacities and training Ukrainian soldiers. Simultaneously, Ukraine has vastly expanded its defense industry with domestic weapons production now covering over 30% of military needs. Kyiv manufactures its own cruise missiles, air and land drones, tanks, infantry fighting vehicles, mobile artillery, anti-tank rockets, mortars, and various types of ammunition.

Ukraine has also adapted to modern warfare much more effectively than Russia, which continues to send waves of barely trained infantry to their deaths in order to capture small tracts of land. The UK Defense Ministry estimates that Russian forces have suffered over 950,000 casualties since launching the war. 2025 promises to be the deadliest year for Russia, with 170,000 casualties recorded in the first four months together with huge losses of tanks and armored vehicles.

About 20% of Russian government spending is for its war against Ukraine. However,  Moscow’s revenues are largely dependent on the sale of oil and gas where the price is steadily falling. Discounts on oil sales exacerbated by tougher U.S. sanctions have substantially dented Moscow’s budget. Meanwhile, Russia’s National Wealth Fund accumulated during the years of booming oil exports has been largely depleted. Experts estimate that energy revenues in 2025 may fall by 20% of those projected by the government. This will have dire consequences for financing the war and for social spending and seriously undermine Russia’s domestic stability.

Janusz Bugajski is a Senior Fellow at the Jamestown Foundation in Washington DC and author of two new books: Pivotal Poland: Europe’s Rising Power and Failed State: A Guide to Russia’s Rupture

/The Geopost