In the last few days, the geopolitical world has been turned upside down by a one-hour call between President Trump and Putin. Two major stakeholders were shocked, Ukraine and the European Union. Whether it was a coincidence that the call happened just before the Munich Security Conference is a mystery.
The next surprise came from the speed of developments thereafter, both countries appointed teams that had already landed in Saudi Arabia for talks. The first set of talks on ending the Ukraine will begin today.
This has certainly left the EU in an urgent and emergency mode as they all met yesterday in France. The main discussion surrounding the immediate actions and the future strategy on the impact of the USA-Russia talks. A leak report not confirmed suggests that the EU is increasing spending to $700 Bn on defence as the first action. The action that President Trump surely would be happy with as they wanted an increase in spending to match theirs.
All these movements are quick and likely positive towards a less frictional geopolitical world. This would certainly have a positive impact on financial and commodity markets especially oil since it has a premium built into the current price.
Whether the war in Ukraine ends or not is too early to call but there are high-speed developments in days that did not take place in months or a year. This also indicates that the properties of the new USA administration are very different from the previous one. As a result, it would surely keep all global stakeholders on their toes for what comes next.
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