Frozen Future – Europe’s Struggle Over 140 Billion, Burning Apartment Blocks in Kyiv and Ukrainian Strikes on Russian Oil Facilities

It is the moment when even the familiar formulas of diplomacy no longer hold. Brussels negotiates, the capitals hesitate, and time in Kyiv runs faster than Europe wants to admit. If the EU member states do not find a way by December to release the compensation based loan of 140 billion euros, backed by the frozen assets of the Russian central bank, Ukraine will slip into a financial crisis as early as the beginning of 2026, one that cuts deep into the everyday life of a country already worn down. And unlike in previous months, there is no room for avoidance this time: the decision is absolute, and it is overdue.

The structure of the plan is known. Since the beginning of the Russian war of aggression, around 300 billion dollars in Russian reserves have been frozen worldwide, about 210 billion euros of which are held in Europe, and 140 billion of those in the Belgian Euroclear depot. Until now, the EU used only the returns of these assets to support Ukraine. But Ursula von der Leyen suggested making the securities themselves usable, not their returns but their core. It would be a signal to Kyiv, to the IMF, to the world, that Europe is taking responsibility at this moment without further overstretching its own budgets.

But Belgium is blocking. The government in Brussels points to legal and financial risks, particularly to possible liability issues and later disputes if Russia were one day to demand compensation. Other EU states are pushing, at times impatiently, to prevent these concerns from bringing the entire process to a halt. “Europe must not become a debating club incapable of acting when it matters,” is the tone behind closed doors. And yet the blockade remains, even though every month counts right now. Because the numbers from Ukraine are relentless. The national budget will need a total of 47 billion dollars in external capital in 2026, compared with 39.3 billion in 2025. Even this amount can only be raised because the ERA funds based on Russian assets and the EU’s Ukraine Facility support virtually every essential state function: healthcare, education, social benefits, energy, pensions. Without these revenues, the country would simply stop functioning.

In fact, the system is already slipping. The state cashback program, an important component of household planning for many families, has been frozen for two months. Medals for school graduates have been abolished, partly to cut costs. Support programs for farmers and horticultural businesses have run out. Even for soldiers’ salaries, the Rada had to increase the budget in the autumn by almost eight billion dollars, money that the ERA fund can no longer provide elsewhere. But 2026 will be more expensive than any year since the start of the war. The entire war effort costs around 120 billion dollars annually. Ukraine itself can cover roughly half of that, no more. The rest must come, or it will be missing. And if it is missing, a form of internal war of attrition begins that is more dangerous than any shortage of ammunition.

On November 13, 2025, Ukraine received around 5.9 billion euros from the European Union, equivalent to about 6.8 billion US dollars. A large part of this sum was channeled through the ERA program, which is tied to revenues from frozen Russian assets. President Wolodymyr Zelensky stated that only sustained pressure on Moscow would have an effect and that the use of these Russian funds therefore had to be intensified.

Several European states have already increased their commitments. Germany plans more than 9.6 billion dollars for 2026, an increase of 3.5 billion. Sweden announced eight billion for 2026 and 2027, the Netherlands 3.8 billion for the coming year. But they know themselves that their increased support does not close the structural gap. The United States, for its part, is providing far less: for 2025, only 300 million dollars are currently on the table. The reconstruction fund announced by Washington and Kyiv is an instrument for the postwar period, not for daily needs.

Our research shows that the IMF could make the release of a loan of around eight billion dollars dependent on whether the EU member states approve the planned 140 billion euros compensation loan based on frozen Russian assets. Such a signal is considered crucial for how financial markets perceive Ukraine and for the stability of Kyiv’s budgetary situation, whenever long term viability is evident. And that is precisely the purpose of the 140 billion package: to show that Ukraine can survive not only militarily but also in terms of its public finances. NATO is announcing exactly the amount Ukraine will lack next year: 60 billion dollars. But even here, there is a gap between words and disbursed funds, and Kyiv does not have this time. The winter of 2025-26 will begin with an already strained budget, and every delay intensifies the pressure.

At the same time, a shadow lies over all these numbers, narrowing Europe’s room for maneuver. The recent corruption affair in Kyiv, resignations, internal investigations, multimillion dollar losses in ministries, has visibly reduced the political space in several European capitals. Not out of rejection of Ukraine, but because there is pressure to secure parliamentary majorities for new multibillion packages without losing public support at home. It is this quiet but persistent skepticism that slows discussions and reduces willingness to further strain national budgets. And yet everyone in Brussels knows that the alternative, a financially faltering Kyiv, will not shorten the war but prolong it.

Massive drone and missile attack by Russia on Kyiv on November 14, 2025 – 6 people were killed and 35 injured

If the compensation loan fails, only two paths remain: a new EU joint debt step that would be difficult to justify in many capitals, or massive national borrowing that could overwhelm already strained budgets. Both paths are politically risky. Both would bind Europe for years. And both would reinforce exactly the narrative the Kremlin has been pushing for months, that Ukraine is a bottomless pit.

Massive drone and missile attack by Russia on Kyiv on November 14, 2025 – 6 people were killed and 35 injured

Meanwhile, the night in Kyiv burned itself once again into the memory of an exhausted country. Flames devoured the upper floors of residential buildings, showers of sparks fell across entire streets, and the red traces of bullets carved lines into the black sky as Russia pounded the capital for hours with drones and missiles. Six people died, dozens were injured, facades collapsed, apartments burned out, and in almost every district firefighters fought against the heat. Sirens began shortly before midnight, fell silent only at dawn, and in between lay the familiar soundscape of the war: the buzzing of attack drones, the rattling of anti aircraft guns, the deep thud of impacts. Thousands sought refuge in metro stations, equipped with mats, chairs, improvised camps, routine in a war entering its fourth year. In the morning the scale was visible: shattered windows, blackened walls, destroyed entrances, a cityscape full of open wounds. In the northeast, in Kharkiv, water and electricity also failed. President Zelensky said it was an attack deliberately aimed at hitting as many people as possible and plunging the winter into cold and darkness.

Massive drone and missile attack by Russia on Kyiv on November 14, 2025 – 6 people were killed and 35 injured

At the same time, Ukraine struck back. While rescue workers in Kyiv searched for missing people, Ukrainian drones hit an oil depot and port facilities in the Russian city of Novorossiysk, and further strikes in recent days disrupted parts of Russia’s power grid. But the balance of the air war remains relentless: Russia sends swarms of attack and decoy drones night after night, along with missiles in numbers that continually overwhelm Ukraine’s defenses. Zelensky is therefore again calling for Patriot systems, which the country cannot finance on its own. Foreign Minister Sybiha warned that the attack demonstrated how urgently new support is needed, air defense, long term assistance, pressure tools against Moscow. For the question is no longer only how to repair destroyed houses, but how a country survives that is forced every night to fight anew for the next morning.

In Russia, the Ukrainian strike on the port of Novorossiysk left noticeable effects. According to several confirmed reports, the export of around 2.2 million barrels of oil and petroleum products per day had to be temporarily halted, about two percent of the world supply. Other sources gave us numbers suggesting possible daily revenue losses of “70 million dollars per day”. So far, our research does not confirm figures of this magnitude. What is certain is that the strike on one of Moscow’s most important export hubs has increased pressure on Russia’s war financing energy sector.

The coming weeks will decide whether Ukraine can survive the winter of 2025-26 in a condition that allows the state to function, sustain military defense and maintain social stability, or whether it will be pushed into a new phase of this war, one in which the battle is fought not only at the front but also against a slow financial exhaustion that no country can endure alone.

It is a risk that everyone is aware of, and yet it threatens to become reality. In conference rooms with dim lights, where the decisions of the coming weeks will be made, lies the difference between a country that breathes despite the war and one that loses its air at the wrong moment.