• President Donald Trump is pausing all military aid to Ukraine.
• The halting of aid affects all military equipment that has not reached Ukraine yet.
• The pause comes after Trump sparred with Volodymyr Zelenskyy in the Oval Office on Friday.

President Donald Trump said that he would pause military aid to Ukraine, days after he clashed with Ukraine's president, Volodymyr Zelenskyy, in the Oval Office.

A White House official told Business Insider in a written statement that: "The President has been clear that he is focused on peace. We need our partners to be committed to that goal as well. We are pausing and reviewing our aid to ensure that it is contributing to a solution."

Malcolm Chalmers, deputy director-general at the UK's Royal United Services Institute, said in a statement sent to BI that the decision was driven by Trump's view that Russia is willing to strike a peace deal, while Ukraine stands in the way.

"But there is no evidence that Russia would be prepared to accept a deal, and what that would be," he said, adding: "This decision will encourage Putin to ask for more — including Ukrainian demilitarization and neutrality."

Mark Cancian, a senior advisor on defense and security at the Centre for Strategic and International Studies, told BI the aid pause would effectively halve Ukraine's total equipment intake and severely weaken its ability to fight.

"That's very serious because even with all the aid they were receiving previously, they were barely hanging on," Cancian said.

"My guess is if US aid does not restart, then Ukrainians could hold out two to four months," Cancian added. "But by four months, I think their front lines will crack, and they'll have to make some sort of deal."

Edward Hunter Christie, a former NATO official and a senior research fellow at the Finnish Institute of International Affairs, told BI that Ukraine's most immediate concern is weaponry like interceptors for its Patriot batteries.

"We will see negative impacts soon," he said. "The question is how much."

Minerals deal in the balance

Discussions in the Oval Office escalated into a war of words on Friday between Vice President JD Vance, Trump, and Zelenskyy.

During the televised meeting, Trump accused Zelenskyy of "gambling with World War III" and was being "disrespectful" to the US.

Vance then accused Zelenskyy of not being grateful or thanking the US sufficiently for the military aid it had provided.

The US has provided $65.9 billion in military assistance to Ukraine since Russia's full-scale invasion in February 2022, per the State Department. Zelenskyy has, on multiple occasions, thanked the US for its help.

Zelenskyy left the White House on Friday without signing a minerals deal with the US that had been under discussion. On Sunday, Zelenskyy said he remains "ready to sign" the agreement.

Trump said in early February that he wanted Ukraine to give the US access to valuable minerals in exchange for continuing to aid its war efforts.

On February 26, Ukrainian Prime Minister Denys Shmyhal said they'd agreed on a deal. Zelenskyy's visit to the White House was supposed to include a deal-signing ceremony in which the two leaders would cement the agreement.

However, it did not turn out that way.

In the meantime, European leaders have rallied around Zelenskyy and Ukraine.

Keir Starmer, the UK's prime minister, welcomed Zelenskyy to 10 Downing Street on Saturday with an embrace and said that Ukraine has the UK's "full backing."

• European leaders held emergency talks to discuss support for Ukraine on Sunday.
• It came amid souring relations between the US and Ukraine, raising pressure on Europe to step up.
• One quick way to raise "game-changing" cash would be to seize $218 billion in frozen Russian assets.

Amid growing tensions between Washington and Kyiv, calls are growing for Europe to take an unprecedented step that could unlock billions in funding for Ukraine.

Some world leaders and politicians, including former UK Prime Minister Rishi Sunak, are urging European countries to seize the roughly $218 billion in frozen Russian central bank assets — now largely held in Brussels — and hand them to Ukraine.

"It is only fair that Russia should pay for the damage its war has caused," Sunak wrote in an opinion piece for The Economist on Friday.

But such a move comes with risks.

The question of funding was a hot topic on Sunday as EU and UK leaders met with Ukrainian President Volodymyr Zelenskyy for emergency talks in London to discuss support for Kyiv — just days after the latter's unprecedented Oval Office clash with President Donald Trump and Vice President JD Vance.

Trump and Vance berated the Ukrainian leader on Friday in front of reporters and cameras. Zelenskyy ultimately left the White House without finalizing a minerals deal that would give the United States access to Kyiv's mineral wealth in exchange for investment and what Zelenskyy hoped would be security guarantees.

The situation has fueled questions over how Europe can step up to help aid Ukraine's defense efforts should the United States reduce, or cut altogether, its support for the war-torn nation.

For Europe to make up the difference would be an expensive prospect and one that could come with political repercussions — which makes the potential to unlock $218 billion in non-taxpayer money all the more attractive.

"We've got all of these different countries with their own internal political battles, and their own internal budgets, all trying to find more cash — and we're sitting on a game-changing amount of funding," Heather Buchanan, the chair of the Athena Foundation, an economic policy advisory nonprofit that supports the move, told Business Insider.

Europe's ace card

The EU holds the majority of the roughly $300 billion in Russian funds frozen by the United States and international allies after Moscow launched its full-scale invasion in February 2022. The funds have been earmarked for rebuilding Ukraine in peacetime.

Some of the interest earned on those funds has been transferred to Ukraine as loans. The UK's chancellor of the exchequer, Rachel Reeves, and Ukraine's finance minister, Sergii Marchenko, signed a deal on Saturday to deliver another £2.26 billion, or about $2.8 billion, to Ukraine from the accrued interest, also as a loan.

But there's now growing support for a long-considered option: seizing those frozen funds, which would allow them to be transferred directly to Ukraine for use in its defense.

In December, Kaja Kallas, the EU's top diplomat, called for the move — and it's seen support in the past week from leaders in the UK, Estonia, Poland, and Finland.

On Saturday, a coalition of campaign groups and UK MPs brought together by the Athena Foundation called on the UK to get the ball rolling with the seizure of £25 billion, or about $31.4 billion, of Russian state assets now frozen in the UK financial system.

Adrian Karatnycky, a nonresident senior fellow with the Atlantic Council's Eurasia Center, wrote in Foreign Policy magazine in January that the full $300 billion in frozen assets could replace the US contribution to Ukraine for the next six or seven years if Trump were to cut support to Kyiv.

A nervous gambit

"The key blocker is that nobody wants to move alone," Buchanan said.

But the White House's recent moves have provided a "perfect storm" that is focusing minds, she added.

While many politicians are pushing for the move, some analysts warn that it should be a last resort because of the impact it could have on global economies.

For example, permanently confiscating Russian assets held in countries that aren't at war with Russia could also "increase the risk perceived by several other countries," Creon Butler, the director of Chatham House's global economy and finance program, wrote last year.

Other countries — such as China, India, and Saudi Arabia — may "fear that at some point they could be subject to similar measures," he wrote.

Sunak, writing for The Economist, has argued that those concerns are "overstated" and that this risk "can be contained."

There's also a debate among analysts over whether the assets should be kept available as a bargaining chip for any future peace talks.

Legal complications must also be considered, as the assets of a foreign nation are normally protected against seizure by a host country.

But the leading lawyer Paul Reichler previously argued to Congress that such protection falls apart when a host state carries out "egregiously wrongful conduct," as he said Russia had.

"If Congress has the power to authorize the executive to freeze a foreign state's assets, it must also have the power to authorize the executive to transfer them," he said.

Buchanan told BI that such a move does require legislation but that "that's what lawmakers are for," adding that meeting a satisfactory legal standard could be brought about "quite quickly."

A further worry is the prospect of retaliation by the Kremlin, whose State Duma is discussing a draft bill allowing it to confiscate foreign property in response to similar moves from "unfriendly countries," Reuters reported.

Striking a psychological blow

Buchanan said passing the cash to Ukraine would send a "crystal clear" signal to Russia that this money isn't coming back — potentially dealing a strong psychological blow to a country whose economy and labor market are already deeply strained by the war.

The question is whether Western leaders will take the leap.

"It's just political will at this point," she added.