Then Trump turned toward Iran. The Russia-Ukraine war dropped in US foreign policy priority list. Now, because of oil and gas, it’s back at the top again. Trump realized that he cannot be at war with two of the largest oil and gas countries in the world. Iran may only be seventh on the list of the world’s largest oil producers, but by closing down the Strait of Hormuz, Iran indirectly affects some 20% of global oil production.

Russia, however, is the world’s second largest producer of both oil and gas. The Europeans dismissed the recent US-Russia diesel deal as another stunt by Trump, and it’s true that it won’t affect gasoline prices in the US by much. If it had been an isolated deal, I wouldn’t have paid much attention either. But it wasn’t. Trump followed up with actions he had hitherto shied away from.

The first sign came last Wednesday morning. Ukrainian media reported that, overnight, the country’s forces had experienced sudden restrictions on Starshield, the military part of Elon Musk’s Starlink satellite system. Ukrainian drones were losing signal when they traveled faster than 160 kilometers per hour. The sudden throttling of the service disrupted several Ukrainian drone missions.

The presumption within Ukraine was that SpaceX had imposed those restrictions on behalf of the US government. And the next day, Reuters reported that the order came directly from the White House, which had been angered by Ukraine’s continued targeting of Russian refineries. So this was not a technical service disruption, but a ruthless application of the kill switch. All we got from the White House, though, were news leaks. No official statements. Not even a tweet. For the Trump administration, this is not normal.

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Along with the news of the throttling of Starshield came suggestions that the US had ended intelligence sharing. On the night of 12 October, Russia launched a volley of ballistic missiles at Ukraine. Normally, US intelligence would give the Ukrainians a warning. But on this occasion, there was no heads-up — and the results were horrendous.

Until that point, intelligence sharing had been one of the most important components of the defense of Ukraine. The Americans have satellite-based infrared systems that can detect ballistic missile launches, and the Ukrainians could rely on it.

But things had changed. Two days after the attack, it was reported that the White House had discussed ending the sharing of intelligence. John Ratcliffe, the CIA director, wanted to continue sharing intelligence — but others, it seems, didn’t. Trump denied that the US had cut intelligence sharing. Indeed, it is possible that Russia may have used weapons that resisted detection. We should at this point treat the disruption of information flows as suspicious, but unexplained, even if that flow now seems to have definitively resumed.

Then, late on Friday, Trump used an executive order to waive the implementation of sanctions against Russia under the Graham Act, whose goal was to deprive Russia of financial resources that allow it to wage war against Ukraine. Named after the late Senator Lindsey Graham, Trump had signed it into law only last month.

The secrecy, the reports of meetings inside the White House, the reports from Ukraine itself, and the suspension of the Graham Act: together these developments give us a coherent picture, even if some of the details are still missing. They tell us that the US is no longer actively engaged in the defense of Ukraine.

That’s different from the situation in late February last year, when Trump and Zelensky clashed in the White House. After that meeting, the US paused weapons deliveries and financial assistance. The White House also cut off intelligence sharing for a week, but then resumed it.

But what the Americans are doing now is far more coordinated. And it presents the Europeans with a conundrum. They will attempt to mitigate the effects of this change in US policy, however, there is not much they can do. They can offer intelligence from their own satellite network, but this will not match the communication quality Ukraine’s fast drones require to function as intended.

Nevertheless, Zelensky turned up at the European Council in Brussels last week, where EU leaders took another opportunity to show their solidarity with the Ukrainian leader. He is a regular guest there. But beneath the bonhomie, tensions are rising. Ukraine is running out of money faster than the Europeans had expected. Last December, the Belgians vetoed the sequestration of Russian funds that are sitting, frozen, in a Belgian bank. The EU reluctantly agreed a €90bn loan to Ukraine, money they themselves borrowed, pretending that Russia would eventually have to pay back this loan. The loan was supposed to plug Ukraine’s funding gap for this year and next.

As it turns out, Ukraine now needs another €70bn. Marine Le Pen, the front-runner in the French presidential election race, has promised that, if elected, she would cut off all support for Ukraine. Friedrich Merz, the German chancellor, has promised more funding, but this money is not showing up anywhere in his government’s own budgets.

While Zelensky revels in the public admiration of Europe’s leaders, then, the foundations of Western support have been getting shakier. Now it is getting even harder, because the US is actively conspiring against Europe. The deal under which the US buys 4.8 million tons of diesel from Russia looks like an attempt to restart commercial relationships. I expect this will be the first of several natural resources deals between the US and Russia.

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I could, for example, see a deal struck over Russian gas. Envoys have been discussing extending their new commercial partnership to the defunct Nord Stream pipeline that used to carry gas from Russia to Germany. This would be an ironic twist, because it was the first Trump administration that placed sanctions on the German and Russian operators who were building Nord Stream 2, a successor pipeline.

In September 2022, the section of piping that runs below the Baltic Sea was sabotaged. A Ukrainian commando is accused of being behind the explosion. The trial against one of the suspects started in Germany last week, and it promises to give us a lot of details of this operation, including information about the extent of Zelensky’s involvement.

Germans will be watching closely. Like Marine Le Pen’s National Rally, the hard-Right Alternative for Germany is also opposed to Ukraine aid. The AfD has, over the past year, enjoyed a fast rise in the opinion polls. The Ukraine war is one of the themes most central to its campaign, and the trial will be a gift to them that will keep on giving.

Trump’s negotiators recently pressed the Europeans to release parts of the frozen Russian assets: to make them available for a special Ukraine investment fund, rather than directing them toward further fighting. The Europeans rejected this request, because their plan is to fund Ukraine’s war with Russian money. I am reminded of the old Thatcher joke about why socialism does not work: because socialists run out of other people’s money. If the EU got its wish and were able to sequester the Russian money, given how fast Ukraine is spending money, it would not last for long.

Additionally, the EU is exploring the possibility of giving full membership of the bloc to Ukraine, but membership can only help fund the reconstruction of Ukraine if accompanied with large fiscal transfers. Right now, Germany is leading a group of countries that are opposing a plan by the European Commission to increase the size of the next EU budget. The Europeans say one thing, but do another: a classic case of revealed preferences clashing with stated preferences.

Politically, and financially, the room for maneuver by the Europeans is decreasing. The Europeans need the US, but the US, having enthusiastically supported Ukraine under Joe Biden, has become first a reluctant supporter and now a country that no longer pretends to support Ukraine. I doubt very much that, come 2029, even a Democratic president would expend political capital on a war, which by then would have been waged for seven years.

Wars usually end when one side is running out of food, oil, or other critical supplies. It is delusional to think that with an oil price at $110 a barrel, the world’s second-largest oil producer is running out of money. The war will end eventually, most likely with a dirty peace deal that will leave the Europeans in shock.

I suspect that it will happen during the remaining two years and three months of the Trump administration. Trump has been too inconsistent for any such forecasts to be made with complete certainty. But I am confident that last week’s decisions will go down as the turning point in this war.

Diesel fuel trades in a global market. Gulf states usually provide 20% of this market, and Russia another 10%. Notwithstanding Donald Trump’s new plan to suspend sanctions on diesel imports from the latter, both these supplies have been severely disrupted. Yes, crude oil is now leaving the Gulf via pipelines, while a shuttle system of state-owned vessels, protected by the US Navy, ensures volumes very close to their pre-war level.

But shipments of refined products and petrochemicals have not recovered. Ukrainian drone attacks have damaged several Russian refineries, perhaps also explaining Trump’s rising anger with President Zelensky, whatever the truth of this latest “energy ceasefire”. China, for its part, has also prohibited the export of refined products in an effort to control domestic prices. Little wonder the rest of the world’s refineries are hard-pressed to meet demand. First of all, there are simply fewer refineries. In 2000, Britain had 18 refineries. Today it has four. Many of the closed refineries were too small to compete internationally, but high industrial electricity costs and environmental regulations also helped make them uneconomic.

Second, a barrel of crude oil contains a variety of molecules that refineries break down into different products: based primarily on their boiling points. Gasoline is a light distillate with a low boiling point. Diesel and jet fuel are middle distillates with higher boiling points, while marine bunker fuel is a heavy distillate. Most refineries are built to process specific types of crude and produce a specific mix of fuels. Separating the different segments of a barrel of crude oil is a complex process; refineries cannot always adjust quickly, even if demand shifts from one product to another.

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Another factor is the shipping industry, which uses 4% of global oil production. In 2020, the United Nations’ International Marine Organization dramatically shifted global energy demand, when it compelled the world’s ship owners to stop using heavy marine bunker fuel, and start burning more environmentally friendly fuels like marine gas oil. Unfortunately, marine gas oil comes from the same segment of the crude barrel as diesel and jet fuel. While the impact of this change was initially masked by Covid, which reduced oil demand, this has permanently increased demand for middle distillates. That, in turn, has raised the cost of all shipping, flying and heavy goods transport, and made diesel and jet-fuel prices more volatile.

Britain now produces only half of the roughly 500,000 barrels of diesel it consumes every day. The rest is imported. Since Russian supplies were suspended in 2022, most of those imports come from the US, Belgium, the Netherlands and the Middle East. All over the world, refineries that can produce diesel and jet fuel are operating at maximum capacity. In the US, capacity utilization has reached 98%, the highest utilization rate in a quarter of a century. The “crack spread”, which measures the difference between what a refinery pays for crude and what it sells product for, is now three times its historic average. If refineries could produce more diesel, they surely would.

The headline-grabbing news in the UK has been £2-a-litre diesel. However, the fuel’s retail price has actually risen by less than the price of crude oil. Dated Brent crude is up 70% this year, while the price of diesel has risen by only 40%. This is largely because, in the UK, two fifths of the price of diesel is tax: which does not vary with the price of crude. Moreover, dated Brent is a spot price that changes with the latest news, while refineries producing diesel operate on more stable long term contracts.

Things look very different in America. The United States is the world’s largest oil producer, and its largest diesel exporter. Most of those exports go to Latin America, not Britain. Nevertheless, diesel fuel prices in the US have risen by nearly 80%, compared with only 40% in the UK. In fact, while retail diesel prices in the UK have risen by a smaller percentage than the price of Brent crude, in the US the opposite is true.

With diesel prices reaching the equivalent of $200 per barrel in the US, and crucial midterms coming up, the Trump administration had ample motivation to act. America is exporting 30% of its diesel production into a global market. At the same time, America’s own strategic petroleum reserve is at its lowest level in 44 years. Between 2021 and 2025, the Biden administration drew down America’s reserve by 45% — or 245 million barrels — largely following the Russian invasion of Ukraine. During that same period, all the other G7 nations together drew down their own reserves by only 40 million barrels. In other words, the US government provided the global market with 85% of the oil used to calm markets after the Russian invasion.

Always a proponent of America first, President Trump concluded that other nations should now draw down their own stocks, rather than continue to rely on American reserves. Trump’s threat to ban US diesel exports has anyway been effective, resulting in a commitment by other G7 members to release 100 million barrels of oil over just four months. As a result of this agreement, diesel prices in both Europe and the United States have declined slightly. For his part, Trump has also signed an executive order granting fuel tax breaks, usually reserved for farmers, to truckers. This latest diesel-exporting agreement with Russia — while mattering more from a geopolitical perspective — is also perhaps intended to help drivers at the pump.

Whether any of this will bring down prices enough to benefit Republican election prospects next month remains to be seen. What may be more long-lasting is the damage done to public opinion on both sides of the Atlantic. Americans increasingly view European governments as freeriders: unwilling to meet their Nato defense commitments, but quite happy to use America’s strategic petroleum reserve and diesel exports to keep their own fuel prices down. As for the Europeans, they see a transactional Trump administration extorting its allies for domestic political purposes. Both sides have a point. Either way, the old political adage remains true: if loyalty is a sentiment, leverage is a fact.