This was supposed to be an EU summit about the EU’s long-term budget. But things are never easy for EU leaders, and world events have a nasty habit of making their way onto the itinerary. That meant this European Council had a lot more on the agenda than the last handful of summits, at least: Energy, migration, enlargement, Ukraine, and more besides were covered — and very little, if anything, was decided. Have FOMO because you weren’t there? Don’t worry, we’ve got you covered. Here’s POLITICO’s rapid roundup of what we learned at the European Council. 1) ENERGY STOLE THE SHOW RIGHT OUT OF THE GATE The summit’s first major clash came Thursday morning, with EU leaders split over whether to delay ETS2, the bloc’s second phase of carbon pricing, to address high energy prices, triggering a three-hour-long standoff. Italy and Greece joined the Visegrád Four — Czechia, Hungary, Poland and Slovakia — in calling for a delay, a push rejected by the majority of countries. The debate dragged on, delaying lunch (spare a thought for our hungry leaders!) and leading to the cancellation of a press conference on Thursday night. 2) BUDGET NEGOTIATIONS ARE A MARATHON… Negotiations on the bloc’s next long-term budget were expected to be one of the summit’s most contentious topics. But they were a nothingburger, with most leaders repeating positions they have held for months. The summit brought them no closer to a breakthrough. Many countries, of course, want a smaller budget, with Swedish Prime Minister Ulf Kristersson telling reporters that his country is “not an ATM for the EU.” Belgian Prime Minister Bart De Wever, meanwhile, said he had no choice but to be frugal at the European level, arguing he is used to tightening his belt at home because his wife is Dutch. Think of Bart next time your Dutch friends ask you to pay them back for that coffee. 3) … AND A SPRINT European Council President António Costa is still aiming to get a budget deal before the end of the year, according to two EU officials. He announced that leaders will hold a special summit at the end of November to try and make progress (and there’s a December summit too). But that timing leaves them up against the clock to reach a deal by year’s end. See you all back here on Nov. 26! 4) EU LEADERS MAY NEED TO BRING EXTRA LUGGAGE NEXT TIME If leaders do hope to agree on the EU’s long-term budget this year, they should prepare for long negotiations in November and December. German Chancellor Friedrich Merz suggested the pre-Christmas summit could last longer than the scheduled two days. “For the December summit, we should pack a few more shirts than usual,” he said. Gulp! 5) YOUR NEXT HOLIDAY TO CYPRUS MIGHT BE A LITTLE EASIER Cypriot President Nikos Christodoulides told reporters he hopes EU leaders will discuss his country’s bid to join the Schengen travel zone at the December summit. “All technical preparations have already been completed, and we hope that the matter will be discussed by the relevant council in December so that the final political decisions can be made,” he said. 6) ROSE-COLORED GLASSES HAVE COME OFF WHEN IT COMES TO COSTA European Council President António Costa drew the ire of some leaders over his handling of negotiations to curb high energy prices, which had become a “mess,” three EU diplomats told POLITICO, with another two diplomats saying that leaders were fuming at Costa for allowing talks to go off the rails. 7) DRINK (A LITTLE) LESS BEER TO HELP UKRAINE Ahead of the summit, Latvian Prime Minister Andris Kulbergs told reporters that supporting Ukraine costs each European the equivalent of one beer a year. “That one beer is just a cost [for EU citizens]. There, it’s a cost of life. We drink less, their lives are saved,” he said. “Simple as that.” He didn’t say whether he meant a beer bought in Stockholm or Prague. As anyone in Belgium knows, not all beers are created equal — or cost the same. 8) THE EU PARLIAMENT WANTS YOU TO KNOW IT MATTERS TOO The European Parliament’s two lead negotiators on the EU budget made the rounds of the press room to make sure journalists heard their views. Siegfried Mureșan (of the European People’s Party) and Carla Tavares (Socialists and Democrats) both stressed that the Parliament’s position is important. Meanwhile, European Parliament President Roberta Metsola joined leaders for the first part of the summit. Metsola said she had made it clear to them that “the Parliament is not a rubber-stamp and never will be.” 9) TALKING CHINA (WITHOUT MENTIONING CHINA) Leaders discussed trade imbalances (read: China) over lunch on Thursday and welcomed the deal the European Commission struck with China last week to curb imports of Chinese hybrid vehicles. Czech PM Andrej Babiš even went so far as to call the deal “fantastic.” POLITICO scooped that the European Commission is expected to work on trade measures tackling imports of chemicals and industrial machinery in an effort to protect European industry from unfair Chinese competition. 10) NEW BROMANCE BREWING Hungarian PM Peter Magyar posted a late-night selfie with Dutch PM Rob Jetten on social media after day one of the summit. The two were all smiles and “tired, but not sad”, as Magyar put it in his tweet. In reaction to the tweet, Jetten told reporters, “We are more or less of the same generation and a tad more direct and pragmatic than some colleagues in the European Council, so there’s a click.” > We started at 7:30 this morning in Brussels. The second shift begins after 10 > PM, with Dutch Prime Minister Rob Jetten @MinPres. > Tired, but not sad. pic.twitter.com/dmtSMbqG4m > > — Magyar Péter (Ne féljetek) (@magyarpeterMP) October 15, 2026 11) BACK TO THE CASTLE António Costa announced that another competitiveness summit at Alden Biesen castle in the Belgian countryside will take place in February 2027, three EU diplomats told POLITICO. Leaders already visited the castle earlier this year, and they clearly loved the Belgian countryside so much they want to return (or Costa is forcing them to go). 12) STILL REELING FROM CEUTA Ahead of Friday’s talks, 16 EU leaders met to discuss migration over breakfast (before discussing migration over lunch with everyone else). According to one EU diplomat, leaders broadly agreed that the EU should be able to suspend asylum applications when faced with a sudden influx of migrants that may have been engineered on purpose. But would that mean the EU will implement pushbacks (which are banned under EU law)? 13) DENMARK, ITALY AND POLAND WANT TO BE TOUGHER ON MIGRATION The three leaders joined forces to argue that migration is a concern for many EU citizens and is contributing to rising crime rates. That caused a delay to an already shockingly long summit. 14) THERE WERE SOME AGREEMENTS Italy’s Giorgia Meloni and Spain’s Pedro Sánchez found some time on the sidelines of the summit to chat about Rome’s restrictions on Spanish nationals sparked by the Ceuta crisis. Plus, France and Germany said they had struck a deal to favor European-made cars under the Industrial Accelerator Act in exchange for weakening a 2035 vehicle emissions target, ending months of wrangling between the bloc’s two biggest economies. 15) EU LEADERS GET THE GOOD STUFF TO EAT Thursday’s lunch menu featured a “full-flavored vegetable jus.” Not a little flavor, not a medium amount of flavor, but the full flavor. Then on Friday there was a “rich jus”. There was also a Champagne sauce. Only the best for our leaders! 16) THE SAME CAN’T BE SAID FOR REPORTERS Some POLITICO journalists lamented the lack of vegetarian options at the Council canteen. Pray for us. 17) NO HARSH WORDS FROM EU TO ZELENSKYY At a press conference on Friday afternoon, Volodymyr Zelenskyy was asked whether EU leaders had expressed annoyance at his recent tone toward U.S. President Donald Trump. The question followed reports that some capitals were frustrated with him and worried he was further riling the White House. But it was all love from Zelenskyy, who said there had been no harsh words during his time in the summit room. “I heard from my European colleagues support and only support, and I’m grateful for this,” he said. 18) NO HUGS FOR FICO As Zelenskyy entered the European Council building, he was seen hugging and kissing fellow leaders — with one exception: Slovakia’s Prime Minister Robert Fico received no hug. That may well have been because Slovakia is preparing to revive a dormant cooperation forum with Moscow. 19) 20M UKRAINIANS COULD FLEE TO EUROPE IF RUSSIA WINS WAR Zelenskyy issued a stark warning to Europe: if Russia wins the war, as many as 20 million Ukrainians could be forced to flee to Europe. Over 4 million Ukrainians already live in EU countries under temporary protection status, according to Eurostat.  20) EU LEADERS HAVE FORGOTTEN ABOUT BRITAIN … OR HAVE THEY? There was plenty of talk across the Channel this week about the U.K. potentially rejoining the bloc, but the subject did not come up at the summit, even with an EU-U.K. summit due next month. EU leaders have more pressing issues on their minds. Still, some had things to say about the U.K.’s relationship with the EU. Foreign policy chief Kaja Kallas said “all our friends are welcome to join,” naming Britain alongside Canada, Norway and Iceland as partners seeking closer ties. Latvian Prime Minister Andris Kulbergs suggested the U.K. “should come back to the family,” although he also said that Russia “had its hands on Brexit.” 21) AT POLITICO, WE SAVE THE BEST FOR LAST Covering European Councils often involves a lot of waiting around, but during this summit conditions were a little tougher because of a phantom farter among reporters waiting for Zelenskyy’s press conference. POLITICO went viral in Brussels’ diplomatic and journalistic circles for reporting the hard facts on our live blog. While this summit’s agenda was packed, in the end not many concrete decisions were taken. Some might say the summit was a load of hot air.

ABERDEEN — The SNP-led Scottish government is set to drop its long-standing opposition to new oil and gas exploration in the North Sea. Two senior members of the Scottish government — granted anonymity to discuss a strategy not yet ready for publication — told POLITICO the government will revise its energy plans to take a more pro-oil and gas exploration position. Tests on compatibility with the government’s climate targets will remain, but Scotland will no longer begin from a position of opposition to new oil and gas projects. The move marks a major change in the Scottish government’s energy policy. The Scottish government — led by the SNP since 2007 — released a draft energy strategy in 2023 which set out its “presumption against” new oil and gas fields in the North Sea. That draft strategy is “out of date,” one senior Scottish government official said. They said a new strategy, expected by the summer, will not contain this wording. A second person with knowledge of the policy said the new strategy will “reflect the world as it is.” The shift in policy comes with the U.K. government widely expected to give the go-ahead to the Jackdaw gas field next week. While the Scottish government has little power over the granting of new licenses for projects such as Jackdaw or the Rosebank oil field — where a decision is expected to come separately and at a later date — it has an important symbolic role, and can apply pressure to the U.K. government to approve licenses.  SNP politicians at the party’s conference in Aberdeen privately admitted the stance on Jackdaw has hurt the party electorally.  The party passed a resolution at its conference Friday which stated that the “utilisation of domestic production” of oil and gas is “clearly preferable to importation”. This was seen as a further softening of the position of the SNP — which governed in a quasi-coalition with the anti-exploration Scottish Greens until as recently as 2004. This resolution, which changes the party’s official policy, will be used as the government writes its new energy strategy, the two people quoted above said. In the summer, the SNP lost a key parliamentary by-election in Aberdeen to the pro-drilling Conservative Party, where their North Sea messaging was a key focus. “It was bruising ,” the official quoted above said. “But we’d been shifting our position for a while.”  Speaking in the debate at the party’s conference Friday, the defeated SNP candidate in that by-election said the victorious Conservatives had hung the words ‘presumption against’ around “our necks lie an albatross.” ”We need to put to bed any suggestion that our party, or our government, supports a ‘presumption against’,” Richard Thomson said. 

BRUSSELS — Ukrainian President Volodymyr Zelenskyy warned Friday that as many as 20 million Ukrainians could be forced to flee to Europe if his country falls to Russia. “Russia is killing us,” Zelenskyy told reporters at a press conference on Friday during a summit of European Union leaders, adding Ukrainians were being “pushed” out of their country. “They [Russia] don’t want to stop.” In the early days of Russia’s full-scale invasion, millions of Ukrainians fled their homes in Europe’s fastest and largest refugee crisis since World War II. Today, over 4 million Ukrainians live in EU countries under temporary protection status, with the largest populations in Germany, Poland and Czechia, according to Eurostat.  Zelenskyy’s stark warning comes as Ukraine heads into a brutal fifth wartime winter under Russian bombardment. Kyiv faces a budget shortfall of $30 to $35 million next year, according to projections from the International Monetary Fund — even accounting for a €90 billion loan Brussels agreed to provide last year.  The Ukrainian president traveled to Brussels to meet with European leaders and shore up financial support for his embattled country. While the EU is Ukraine’s staunchest backer, the bloc’s list of priorities is stacked with rising energy costs, looming elections, geopolitical crises and an impasse over its €2 trillion budget. 

This story was originally published by Inside Climate News and is reproduced here as part of the Climate Desk collaboration. A four-hour legislative committee hearing in June, punctuated by applause and anger, offered a window into the growing backlash against data centers. The prospect of unchecked development has galvanized a cross-section of Ohioans, urban and rural, Democrat and Republican, alarmed about the spread of the giant computing facilities. Residents are demanding that local governments impose bans and moratoria on data centers while gathering signatures for a statewide ballot measure that could go before voters in 2027. Leading the push is an eclectic group from rural Southern Ohio, including an outdoor-tourism guide, a lawyer and others who fear that the state’s data center boom is changing their communities faster than they can respond. “Especially on America’s 250th anniversary it’s your job to make sure there’s life for another 250,” Nikki Gerber, the tourism guide, said at the June 1 statehouse hearing. Data centers powered by fossil fuels are a rising source of planet-warming emissions. But for many opponents, the concerns are closer to home: They fear that data centers will change the look and feel of familiar landscapes and threaten local air and water. Resistance to data centers is spreading across the country, especially against the supersize complexes being built to support artificial intelligence. The issue is emerging as a focal point in the November midterm elections, with about 40 local ballot measures in seven states, according to Ballotpedia. Ohio has the most, with 21, including 10 communities set to vote next month on local restrictions on data centers: Conneaut, Defiance, Granville, Oregon, Pataskala, Piqua, Sunbury, Upper Sandusky, Trenton, and Urbana. The Ohio campaign stands out because the Columbus region has become one of the nation’s data center development hot spots. If opponents prevail in Ohio, the outcome could reverberate beyond the state. But Gerber is not thinking about the national stakes. Her focus is the 1.3-gigawatt data center that Amazon Web Services wants to build about 15 miles from her campground. She’s worried about what the project could do to the area’s water levels and biodiversity. Inside Climate News visited her business, Moondoggie Liveree, tucked into the woods near Ohio Brush Creek, which flows into the Ohio River in Adams County. Gerber’s office is an open-air shed left behind by a previous owner, with walls covered with knickknacks, bumper stickers and signs. Among the messages: “Watch! 4 Turtles! Caution!” The business rents campsites, canoes and kayaks, and assists hikers. “Everybody thinks Ohio’s flat,” she said. “But it’s not, and it’s a really, really special area out here.” The office of Moondoggie Liveree, a business that supports camping, kayaking and outdoor tourism.Dan Gearino/Inside Climate News Gerber is a local leader in promoting Adams County—one of Ohio’s poorest counties based on median household income—as a destination for outdoor tourism. She’s worried that the proposed data center could open the door to more projects, transforming the rustic landscape into an industrial zone. She bought her property after working for years as a medical assistant. During the offseason, she builds rental cabins around the region. After learning about the proposed Amazon data center early this year, she grew frustrated by what she saw as a lack of details from the local government. Adams County officials did not respond to requests for comment for this story. In neighboring Brown County, also one of the poorest counties in the state, attorney Austin Baurichter left his job at a law firm office in Cincinnati, partly because he didn’t want to work on behalf of data center developers. He opened his own practice and connected with Gerber and others looking for answers about the projects. They seem to have little in common. Gerber spends most of her day outdoors in flip-flops and shorts, while Baurichter is an early-career lawyer, usually dressed in a suit and tie. But they share a dedication to the cause. Gerber is “the living embodiment of the sparkle emoji,” Baurichter said, interviewed by phone from his home office. He praised her energy and optimism. The two are among the half-dozen people at the core of Conserve Ohio, the organization leading a statewide campaign for a data center moratorium. Austin Baurichter testifies before the Select Committee on Data Centers on June 1 in Columbus, Ohio, asking lawmakers to listen to concerns about out-of-control development.The Ohio Channel via Inside Climate News Baurichter has grown frustrated with local governments, which he says are becoming more hostile toward data center opponents. He argues that some officials “got bamboozled” by developers early on, sometimes signing nondisclosure agreements and supporting projects without understanding the ramifications. He approaches his activism with intensity, bringing his legal skills into the fight, filing public-records requests and questioning officials at public meetings. > “We would rather you fight for our honor than for scraps that are being > offered by people who know what they’re offering [is] scraps.” In late September, he was there when the Ohio General Assembly voted on a temporary pause in the state’s gasoline tax. Data center opponents, along with Democratic gubernatorial candidate Amy Acton, a former director of the state health department, urged lawmakers to pass a measure pausing data center development that day. Majority Republicans declined to take up the issue. Ohio political blogger D.J. Byrnes, who writes The Rooster newsletter about Ohio politics, captured video of Baurichter speaking on the sidelines with state Rep. Bride Rose Sweeney, a Cleveland-area Democrat. Baurichter admonished her for not doing more. “We would rather you fight for our honor than for scraps that are being offered by people who know what they’re offering [is] scraps,” he said. His conversations at the statehouse underscored his sense that leaders are not listening. “It’s exhausting, like throwing your energy down a black hole,” he said soon after. The legislature responded to public concerns last spring by creating the Select Committee on Data Centers. The panel has met five times, including the June 1 hearing, and has gathered feedback from local officials, data center companies, and the public. “We’re committed to being a good neighbor—operationally, economically, and in how we engage with communities across the state,” Thor Underdahl, data center and energy public policy manager for Meta, said at a June 4 committee hearing. Craig Sundstrom, head of energy and sustainability policy for Amazon Web Services, testified about the jobs and investment that data centers could bring. He pushed back against concerns about their water use, saying claims about excessive water consumption are false. An Amazon data center “uses less water than a few car washes do annually,” he said. State Rep. Adam Holmes, a Republican from a rural district in the east-central part of Ohio, is the committee’s co-chair. In an interview, he said that legislators are in a fact-finding phase, trying to understand how the state can reap the economic benefits of development while addressing the issues raised by voters. “It’s overwhelming the amount of money that’s coming, and it’s coupled with this historic transformation in technology that we’re facing,” he said. “The change is dramatic; that creates a lot of anxiety.” Ohio Rep. Adam Holmes, co-chairman of the Select Committee on Data Centers, speaking on the House floor.Ohio General Assembly via Inside Climate News Holmes wants to make sure consumers are protected from potential increases in electricity and water bills tied to data centers’ demand for those resources, he said. But he’s still figuring out how to approach proposals that would pause development. He noted that both Acton, the Democratic nominee, and her Republican opponent, businessman Vivek Ramaswamy, support some form of a moratorium. That said, candidates differ on what could come next. On her campaign website, Acton has called for greater transparency, ending state incentives for data centers and restricting where they can be built. This is in addition to a moratorium that would give lawmakers time to establish new rules. Ramaswamy, a former presidential candidate and prominent supporter of President Donald Trump, has proposed making electricity free for residents of communities with data centers and strictly enforcing clean-air and clean-water rules for the projects. He supports pausing development until state law clearly protects consumers. “Despite my opponents’ claims, I’m not ‘pro-data center,’” he said on his campaign website. “I’m pro-Ohio, and I have a plan to fix the problem.” Conserve Ohio leaders are skeptical of both candidates. They question whether politicians, especially Republicans, can withstand pressure from gigantic tech companies and Trump. The Trump administration has a stake in Ohio’s data center debate because the federal government owns the land that would host the largest data center in the country, Ports Technology Campus near Piketon, which is not far from Adams and Brown counties. When fully built, the project would require 10,000 megawatts of electricity. A proposed natural-gas power plant would supply 9,200 megawatts, with an additional 800 megawatts that may come from other sources. The federal government is working with SoftBank, the Japanese conglomerate, to develop the site, with OpenAI expected to be its primary user. Even though Ports Technology Campus is a short drive from where Gerber and Baurichter live, the project is almost too large for them to comprehend, and its federal ownership makes it difficult to challenge, they said. So far, the proposal has drawn little opposition in Pike County, which, like Adams and Brown counties, has struggled to attract jobs for decades. Data center opponents are focusing on several dozen hot spots where resistance is strongest. Conserve Ohio advises local activists on how to obtain public records. In return, local activists help gather signatures for a statewide moratorium vote. As of Oct. 2, the campaign has collected about 140,000 signatures of the roughly 410,000 needed to qualify for the ballot, Baurichter said.The campaign is too late to make the November ballot, meaning the earliest the issue could go before voters is 2027. Polling suggests the campaign has public support. A survey released by Bowling Green State University’s Democracy and Public Policy Network found that 75 percent of residents opposed data center construction in their communities, while 63 percent oppose such projects anywhere in Ohio and 55 percent oppose them anywhere in the United States. Ohio has emerged as one of the country’s leading data center markets, ranking among the top five states for development based on the number of projects and their electricity demand, according to industry research firms. Cushman & Wakefield, a commercial real estate research firm, ranks Columbus third among US data center markets behind Virginia and Portland and Eastern Oregon. Much of the development has happened in New Albany, a suburb northeast of Columbus. Amazon and Meta were among the companies that built large data centers in New Albany in the 2010s. Today, rows of buildings filled with computer equipment, surrounded by muddy construction sites, occupy much of the city, as The Columbus Dispatch showed in a recent video. For data center opponents, New Albany is an example to be avoided. An aerial view of Google’s New Albany data center campus in Central Ohio. Google via Inside Climate News Michael Thomas, CEO of Cleanview, a research firm that tracks power plants and data centers, said that the Columbus-New Albany area is attractive for data centers because of its abundant electricity and close proximity to many of the nation’s population centers. “Ohio has cheaper power than most other states, and historically the state and its utilities have offered generous incentives and easy permitting,” he said in an email. Back on Gerber’s property, she led a tour of Ohio Brush Creek, where the water level was unusually low. The area, she said, has suffered from drought broken up by flooding, making her wary of projects that may affect the region’s water. The campaign has cost Gerber time and added to her stress, but she sees those costs as small compared with what is at stake. She believes this fight will determine the future of Adams County. “It’s overwhelming,” she said.

Listen on * Spotify * Apple Music * Amazon Music Während Friedrich Merz in Riad und Katar wieder in die Rolle des „Außenkanzlers“ schlüpft, herrscht in Berlin politische Windstille. Doch hinter dem „Winteridyll“ an der Spree brodelt es: Landtagswahlkämpfe und aufgeschobene Reformen setzen die Koalition unter Druck. Rasmus Buchsteiner analysiert, ob die Regierung gerade wirklich arbeitet oder nur eine riskante Pause einlegt, bevor das „Reformfenster“ im Sommer endgültig zuschlägt. Im 200-Sekunden-Interview geht Juso-Chef Philipp Türmer zum Angriff auf die CDU über und warnt vor einem „Großangriff auf das soziale Sicherungssystem“. Er stellt klar, warum die SPD keinen „dänischen Weg“ einschlagen sollte, während die eigene Partei am Wochenende den Prozess zum neuen Grundsatzprogramm starten wird. ⁠Neue Recherchen von Frederik Schindler von WELT⁠ decken eine für die AfD-Chefin Alice Weidel sehr unliebsame Personalie in Bayern auf: Der Bundessprecher der Identitären Bewegung ist Mitglied der AfD. Ein direkter Bruch der Unvereinbarkeitsliste, die Weidel in Erklärungsnot bringt und die interne Machtfrage zwischen Berlin und den Landesverbänden neu entfacht. Und: ein kurzes Gespräch mit Cathrin Wilhelm von ⁠Avilus⁠ über die Anwendung von Drohnen, die vielen Deutschen so bisher unbekannt sein dürfte. Das Berlin Playbook als Podcast gibt es jeden Morgen ab 5 Uhr. Gordon Repinski und das POLITICO-Team liefern Politik zum Hören – kompakt, international, hintergründig. Für alle Hauptstadt-Profis: Der Berlin Playbook-Newsletter bietet jeden Morgen die wichtigsten Themen und Einordnungen. ⁠Jetzt kostenlos abonnieren.⁠ Mehr von Host und POLITICO Executive Editor Gordon Repinski: Instagram: ⁠@gordon.repinski⁠ | X: ⁠@GordonRepinski⁠. POLITICO Deutschland – ein Angebot der Axel Springer Deutschland GmbH Axel-Springer-Straße 65, 10888 Berlin Tel: +49 (30) 2591 0 information@axelspringer.de⁠ Sitz: Amtsgericht Berlin-Charlottenburg, HRB 196159 B USt-IdNr: DE 214 852 390 Geschäftsführer: Carolin Hulshoff Pol, Mathias Sanchez Luna

LONDON — Victory is finally in sight for the Bank of England. But rate cuts aren’t. It’s taken Britain’s central bank longer to bring inflation under control than any of its peers on the global stage, but on Thursday economists expect forecasts to show that inflation in the U.K. will return to the government’s 2 percent target within the next two years, having overshot it for almost all of the last four. The pound surged to its highest level against the dollar in five years last month, as global confidence in the anchor of the world’s financial system appeared to fray due to the news flow out of the U.S. But there will be little else to set the pulse racing: Financial market participants are almost unanimous in expecting no change in the Bank rate from its current 3.75 percent. Even the extraordinary events of January, which saw the U.S. seize Venezuelan leader Nicolas Maduro and U.S. President Donald Trump threaten military force against his NATO allies over Greenland, seem unlikely to induce a shift in the Bank’s communication about the U.K.’s economic outlook. Extrapolating how these seismic events will translate into the U.K. economy has been hard. One of the more hawkish members of the Bank’s Monetary Policy Committee, Megan Greene, argued in a speech last month that while a stronger pound should help keep the cost of imports down, it could easily be offset by other factors, especially if the U.S. Federal Reserve were to be pressured by the White House into cutting U.S. interest rates more aggressively. Greene argued the MPC should focus on what is in its power to control. Here, the Bank is facing a familiar conundrum: growth is sluggish and unemployment is trending higher, but inflation is coming down — even if painfully slowly — and most business surveys suggest wage growth will continue to outstrip what is justified by productivity. Headline inflation ticked up again in December to 3.4 percent, still far above the 2 percent target. The latest data suggest that the economy is still more or less ticking along, growing at an annual rate of 1.4 percent in the three months through November. STILL ‘GRADUAL AND CAUTIOUS’ The narrow vote by the MPC to cut the Bank rate to 3.75 percent from 4 percent at its last meeting in December — and the unwavering message from the Bank that it will take a “gradual and cautious” approach to easing policy — means the committee will stay put on Thursday, according to Deutsche Bank economist Sanjay Raja. UBS economist Anna Titareva, meanwhile, reckons the vote will be split, with both Governor Andrew Bailey and Deputy Governor Sarah Breeden capable of voting again for a cut alongside Alan Taylor and Swati Dhingra, the two external members most concerned about the risks of a slowdown and an accompanying rise in joblessness. But that scenario would still leave Bailey in the minority against the remaining five of nine members in the committee. Most analysts still expect the Bank to cut interest rates twice this year. Inflation is set to fall from April as Chancellor Rachel Reeves’ decision to strip green levies off energy bills causes a drop in final prices for electricity. Deutsche’s Raja expects cuts in March and again in June, but says rates are unlikely to fall any further after that.

The Trump administration wants to work with traditional allies to secure new supplies of critical minerals. But months of aggression toward allies, culminating with since-aborted threats to seize Greenland, have left many cool to the overtures. While the State Department has drawn a lengthy list of participating countries for its first Critical Minerals Ministerial scheduled for Wednesday, a number of those attending are hesitant to commit to partnering with the U.S. in creating a supply chain that bypasses China’s current chokehold on those materials, according to five Washington-based diplomats of countries invited to or attending the event. State Department cables obtained by POLITICO also show wariness among some countries about signing onto a framework agreement pledging joint cooperation in sourcing and processing critical minerals. Representatives from more than 50 countries are expected to attend the meeting, according to the State Department — all gathered to discuss the creation of tech supply chains that can rival Beijing’s. But the meeting comes just two weeks since President Donald Trump took to the stage at Davos to call on fellow NATO member Denmark to allow a U.S. takeover of Greenland, and that isn’t sitting well. “We all need access to critical minerals, but the furor over Greenland is going to be the elephant in the room,” said a European diplomat. In the immediate run-up to the event there’s “not a great deal of interest from the European side,” the person added. The individual and others were granted anonymity to discuss sensitive diplomatic relationships. Their concerns underscore how international dismay at the Trump administration’s foreign policy and trade actions may kneecap its other global priorities. The Trump administration had had some success over the past two months rallying countries to support U.S. efforts to create secure supply chains for critical minerals, including a major multilateral agreement called the Pax Silica Declaration. Now those gains could be at risk. Secretary of State Marco Rubio wants foreign countries to partner with the U.S. in creating a supply chain for the 60 minerals (including rare earths) that the U.S. Geological Survey deems “vital to the U.S. economy and national security that face potential risks from disrupted supply chains.” They include antimony, used to produce munitions; samarium, which goes into aircraft engines; and germanium, which is essential to fiber-optics. The administration also launched a $12 billion joint public-private sector “strategic critical minerals stockpile” for U.S. manufacturers, a White House official said Monday. Trump has backed away from his threats of possibly deploying the U.S. military to seize Greenland from Denmark. But at Davos he demanded “immediate negotiations” with Copenhagen to transfer Greenland’s sovereignty to the U.S. That makes some EU officials leery of administration initiatives that require cooperation and trust. “We are all very wary,” said a second European diplomat. Rubio’s critical minerals framework “will not be an easy sell until there is final clarity on Greenland.” Trump compounded the damage to relations with NATO countries on Jan. 22 when he accused member country troops that deployed to support U.S. forces in Afghanistan from 2001 to 2021 of having shirked combat duty. “The White House really messed up with Greenland and Davos,” a third European diplomat said. “They may have underestimated how much that would have an impact.” The Trump administration needs the critical minerals deals to go through. The U.S. has been scrambling to find alternative supply lines for a group of minerals called rare earths since Beijing temporarily cut the U.S. off from its supply last year. China — which has a near-monopoly on rare earths — relented in the trade truce that Trump brokered with China’s leader Xi Jinping in South Korea in October. The administration is betting that foreign government officials that attend Wednesday’s event also want alternative sources to those materials. “The United States and the countries attending recognize that reliable supply chains are indispensable to our mutual economic and national security and that we must work together to address these issues in this vital sector,” the State Department statement said in a statement. The administration has been expressing confidence that it will secure critical minerals partnerships with the countries attending the ministerial, despite their concerns over Trump’s bellicose policy. “There is a commonality here around countering China,” Ruth Perry, the State Department’s acting principal deputy assistant secretary for ocean, fisheries and polar affairs, said at an industry event on offshore critical minerals in Washington last week. “Many of these countries understand the urgency.” Speaking at a White House event Monday, Interior Secretary Doug Burgum indicated that 11 nations would sign on to a critical minerals framework with the United States this week and another 20 are considering doing so. Greenland has rich deposits of rare earths and other minerals. But Denmark isn’t sending any representatives to the ministerial, according to the person familiar with the event’s planning. Trump said last month that a framework agreement he struck with NATO over Greenland’s future included U.S. access to the island’s minerals. Greenland’s harsh climate and lack of infrastructure in its interior makes the extraction of those materials highly challenging. Concern about the longer term economic and geostrategic risks of turning away from Washington in favor of closer ties with Beijing — despite the Trump administration’s unpredictability — may work in Rubio’s favor on Wednesday. “We still want to work on issues where our viewpoints align,” an Asian diplomat said. “Critical minerals, energy and defense are some areas where there is hope for positive movement.” State Department cables obtained by POLITICO show the administration is leaning on ministerial participants to sign on to a nonbinding framework agreement to ensure U.S. access to critical minerals. The framework establishes standards for government and private investment in areas including mining, processing and recycling, along with price guarantees to protect producers from competitors’ unfair trade policies. The basic template of the agreement being shared with other countries mirrors language in frameworks sealed with Australia and Japan and memorandums of understanding inked with Thailand and Malaysia last year. Enthusiasm for the framework varies. The Philippine and Polish governments have both agreed to the framework text, according to cables from Manila on Jan. 22 and Warsaw on Jan. 26. Romania is interested but “proposed edits to the draft MOU framework,” a cable dated Jan. 16 said. As of Jan. 22 India was noncommittal, telling U.S. diplomats that New Delhi “could be interested in exploring a memorandum of understanding in the future.” European Union members Finland and Germany both expressed reluctance to sign on without clarity on how the framework aligns with wider EU trade policies. A cable dated Jan. 15 said Finland “prefers to observe progress in the EU-U.S. discussions before engaging in substantive bilateral critical mineral framework negotiations.” Berlin also has concerns that the initiative may reap “potential retaliation from China,” according to a cable dated Jan. 16. Trump’s threats over the past two weeks to impose 100 percent tariffs on Canada for cutting a trade deal with China and 25 percent tariffs on South Korea for allegedly slow-walking legislative approval of its U.S. trade agreement are also denting enthusiasm for the U.S. critical minerals initiative. Those levies “have introduced some uncertainty, which naturally leads countries to proceed pragmatically and keep their options open,” a second Asian diplomat said. There are also doubts whether Trump will give the initiative the long-term backing it will require for success. “There’s a sense that this could end up being a TACO too,” a Latin American diplomat said, using shorthand for Trump’s tendency to make big threats or announcements that ultimately fizzle. Analysts, too, argue it’s unlikely the administration will be able to secure any deals amid the fallout from Davos and Trump’s tariff barrages. “We’re very skeptical on the interest and aptitude and trust in trade counterparties right now,” said John Miller, an energy analyst at TD Cowen who tracks critical minerals. “A lot of trading partners are very much in a wait-and-see perspective at this point saying, ‘Where’s Trump really going to go with this?’” And more unpredictability or hostility by the Trump administration toward longtime allies could push them to pursue critical mineral sourcing arrangements that exclude Washington. “The alternative is that these other countries will go the Mark Carney route of the middle powers, cooperating among themselves quietly, not necessarily going out there and saying, ‘Hey, we’re cutting out the U.S.,’ but that these things just start to crop up,” said Jonathan Czin, a former China analyst at the CIA now at the Brookings Institution. “Which will make it more challenging and allow Beijing to play divide and conquer over the long term.” Felicia Schwartz contributed to this report.

BERLIN — Friedrich Merz embarks on his first trip to the Persian Gulf region as chancellor on Wednesday in search of new energy and business deals he sees as critical to reducing Germany’s dependence on the U.S. and China. The three-day trip with stops in Saudi Arabia, Qatar and the United Arab Emirates illustrates Merz’s approach to what he calls a dangerous new epoch of “great power politics” — one in which the U.S. under President Donald Trump is no longer a reliable partner. European countries must urgently embrace their own brand of hard power by forging new global trade alliances, including in the Middle East, or risk becoming subject to the coercion of greater powers, Merz argues. Accompanying Merz on the trip is a delegation of business executives looking to cut new deals on everything from energy to defense. But one of the chancellor’s immediate goals is to reduce his country’s growing dependence on U.S. liquefied natural gas, or LNG, which has replaced much of the Russian gas that formerly flowed to Germany through the Nord Stream pipelines. Increasingly, German leaders across the political spectrum believe they’ve replaced their country’s unhealthy dependence on Russian energy with an increasingly precarious dependence on the U.S. Early this week, Merz’s economy minister, Katherina Reiche, traveled to Saudi Arabia ahead of the chancellor to sign a memorandum to deepen the energy ties between both countries, including a planned hydrogen energy deal. “When partnerships that we have relied on for decades start to become a little fragile, we have to look for new partners,” Reiche said in Riyadh. ‘EXCESSIVE DEPENDENCE’ Last year, 96 percent of German LNG imports came from the U.S, according to the federal government. While that amount makes up only about one-tenth of the country’s total natural gas imports, the U.S. share is set to rise sharply over the next years, in part because the EU agreed to purchase $750 billion worth of energy from the U.S. by the end of 2028 as part of its trade agreement with the Trump administration. The EU broadly is even more dependent on U.S. LNG, which accounted for more than a quarter of the bloc’s natural gas imports in 2025. This share is expected to rise to 40 percent by 2030. German politicians across the political spectrum are increasingly pushing for Merz’s government to find new alternatives. “After Russia’s war of aggression, we have learned the hard way that excessive dependence on individual countries can have serious consequences for our country,” said Sebastian Roloff, a lawmaker focusing on energy for the center-left Social Democrats, who rule in a coalition with Merz’s conservatives. Roloff said Trump’s recent threat to take over Greenland and the new U.S. national security strategy underscored the need to “avoid creating excessive dependence again” and diversify sources of energy supply. The Trump administration’s national security strategy vows to use “American dominance” in oil, gas, coal and nuclear energy to “project power” globally, raising fears in Europe that the U.S. will use energy exports to gain leverage over the EU. Last year, 96 percent of German LNG imports came from the U.S, according to the federal government. | Pool photo by Lars-Josef Klemmer/EPA That’s why Merz and his delegation are also seeking closer ties to Qatar, one of the world’s largest producers and exporters of natural gas as well as the United Arab Emirates, another major LNG producer. Last week, the EU’s energy chief, Dan Jørgensen, said the bloc would step up efforts to to reduce it’s dependence on U.S. LNG., including by dealing more with Qatar. One EU diplomat criticised Merz for seeking such cooperation on a national level. Germany is going “all in on gas power, of course, but I can’t see why Merz would be running errands on the EU’s behalf,” said the diplomat, speaking on condition of anonymity. ‘AUTHORITARIAN STRONGMEN’ Merz will also be looking to attract more foreign investment and deepen trade ties with the Gulf states as part of a wider strategy of forging news alliances with “middle powers” globally and reduce dependence on U.S. and Chinese markets. The EU initiated trade talks with the United Arab Emirates last spring. Gulf states like Saudi Arabia also have their own concerns about dependencies on the U.S., particularly in the area of arms purchases. Germany’s growing defense industry is increasingly seen as promising partner, particularly following Berlin’s loosening of arms export restrictions. “For our partners in the region, cooperation in the defense industry will certainly also be an important topic,” a senior government official with knowledge of the trip said.  But critics point out that leaders of autocracies criticized for human rights abuses don’t make for viable partners on energy, trade and defense. Last week, the EU’s energy chief, Dan Jørgensen, said the bloc would step up efforts to to reduce it’s dependence on U.S. LNG., including by dealing more with Qatar. | Jose Sena Goulao/EPA “It’s not an ideal solution,” said Loyle Campbell, an expert on climate and energy policy for the German Council on Foreign Relations. “Rather than having high dependence on American LNG, you’d go shake hands with semi-dictators or authoritarian strongmen to try and reduce your risk to the bigger elephant in the room.” Merz, however, may not see a moral contradiction. Europe can’t maintain its strength and values in the new era of great powers, he argues, without a heavy dollop of Realpolitik. “We will only be able to implement our ideas in the world, at least in part, if we ourselves learn to speak the language of power politics,” Merz recently said. Ben Munster contributed to this report.

KYIV — Russia broke an energy truce brokered by U.S. President Donald Trump after just four days on Tuesday, hitting Ukraine’s power plants and grid with more than 450 drones and 70 missiles. “The strikes hit Sumy and Kharkiv regions, Kyiv region and the capital, as well as Dnipro, Odesa, and Vinnytsia regions. As of now, nine people have been reported injured as a result of the attack,” Ukrainian President Volodymyr Zelenskyy said in a morning statement. The Russian strike occurred half-way through a truce on energy infrastructure attacks that was supposed to last a week, and only a day before Russian, Ukrainian and American negotiators are scheduled to meet in Abu Dhabi for the next round of peace talks.   The attack, especially on power plants and heating plants in Kyiv, Kharkiv and Dnipro, left hundreds of thousands of families without heat when the temperature outside was −25 degress Celsius, Ukrainian Energy Minister Denys Shmyhal said. “Putin waited for the temperatures to drop and stockpiled drones and missiles to continue his genocidal attacks against the Ukrainian people. Neither anticipated diplomatic efforts in Abu Dhabi this week nor his promises to the United States kept him from continuing terror against ordinary people in the harshest winter,” said Andrii Sybiha, the Ukrainian foreign minister. Last Thursday, Trump said Putin had promised he would not bomb Ukraine’s energy infrastructure for a week. Zelenskyy had said that while it was not an officially agreed ceasefire, it was an opportunity to de-escalate the war and Kyiv would not hit Russian oil refineries in response. “This very clearly shows what is needed from our partners and what can help. Without pressure on Russia, there will be no end to this war. Right now, Moscow is choosing terror and escalation, and that is why maximum pressure is required. I thank all our partners who understand this and are helping us,” Zelenskyy said.

BRUSSELS ― European governments and corporations are racing to reduce their exposure to U.S. technology, military hardware and energy resources as transatlantic relations sour.  For decades, the EU relied on NATO guarantees to ensure security in the bloc, and on American technology to power its business. Donald Trump’s threats to take over Greenland, and aggressive comments about Europe by members of his administration, have given fresh impetus to European leaders’ call for “independence.” “If we want to be taken seriously again, we will have to learn the language of power politics,” German Chancellor Friedrich Merz said last week. From orders banning civil servants from using U.S.-based videoconferencing tools to trade deals with countries like India to a push to diversify Europe’s energy suppliers, efforts to minimize European dependence on the U.S. are gathering pace. EU leaders warn that transatlantic relations are unlikely to return to the pre-Trump status quo. EU officials stress that such measures amount to “de-risking” Europe’s relationship with the U.S., rather than “decoupling” — a term that implies a clean break in economic and strategic ties. Until recently, both expressions were mainly applied to European efforts to reduce dependence on China. Now, they are coming up in relation to the U.S., Europe’s main trade partner and security benefactor. The decoupling drive is in its infancy. The U.S. remains by far the largest trading partner for Europe, and it will take years for the bloc to wean itself off American tech and military support, according to Jean-Luc Demarty, who was in charge of the European Commission’s trade department under the body’s former president, Jean-Claude Juncker. Donald Trump’s threats to take over Greenland, and aggressive comments about Europe by members of his administration, have given fresh impetus to European leaders’ call for “independence.” | Kristian Tuxen Ladegaard Berg/NurPhoto via Getty Images “In terms of trade, they [the U.S.] represent a significant share of our exports,” said Demarty. “So it’s a lot, but it’s not a matter of life and death.” The push to diversify away from the U.S. has seen Brussels strike trade deals with the Mercosur bloc of Latin American countries, India and Indonesia in recent months. The Commission also revamped its deal with Mexico, and revived stalled negotiations with Australia. DEFENDING EUROPE: FROM NATO TO THE EU Since the continent emerged from the ashes of World War II, Europe has relied for its security on NATO — which the U.S. contributes the bulk of funding to. At a weekend retreat in Zagreb, Croatia, conservative European leaders including Merz said it was time for the bloc to beef up its homegrown mutual-defense clause, which binds EU countries to an agreement to defend any EU country that comes under attack. While it has existed since 2009, the EU’s Article 42.7 mutual defense clause was rarely seen as necessary because NATO’s Article 5 served a similar purpose. But Europe’s governments have started to doubt whether the U.S. really would come to Europe’s rescue. In Zagreb, the leaders embraced the EU’s new role as a security actor, tasking two leaders, as yet unnamed, with rapidly cooking up plans to turn the EU clause from words to an ironclad security guarantee. “For decades, some countries said ‘We have NATO, why should we have parallel structures?’” said a senior EU diplomat who was granted anonymity to talk about confidential summit preparations. After Trump’s Greenland saber-rattling, “we are faced with the necessity, we have to set up military command structures within the EU.” At a weekend retreat in Zagreb, Croatia, conservative European leaders including Merz said it was time for the bloc to beef up its homegrown mutual-defense clause, which binds EU countries to an agreement to defend any EU country that comes under attack. | Marko Perkov/AFP via Getty Images In comments to EU lawmakers last week, NATO Secretary-General Mark Rutte said that anyone who believes Europe can defend itself without the U.S. should “keep on dreaming.” Europe remains heavily reliant on U.S. military capabilities, most notably in its support for Ukraine’s fight against Russia. But some Europeans are now openly talking about the price of reducing exposure to the U.S. — and saying it’s manageable. TECHNOLOGY: TEAMS OUT, VISIO IN The mood shift is clearest when it comes to technology, where European reliance on platforms such as X, Meta and Google has long troubled EU voters, as evidenced by broad support for the bloc’s tech legislation. French President Emmanuel Macron’s government is planning to ban officials from using U.S.-based videoconferencing tools. Other countries like Germany are contemplating similar moves. “It’s very clear that Europe is having our independence moment,” EU tech czar Henna Virkkunen told a POLITICO conference last week. “During the last year, everybody has really realized how important it is that we are not dependent on one country or one company when it comes to some very critical technologies.” France is moving to ban public officials from using American platforms including Google Meet, Zoom and Teams, a government spokesperson told POLITICO. Officials will soon make the switch to Visio, a videoconferencing tool that runs on infrastructure provided by French firm Outscale. In the European Parliament, lawmakers are urging its president, Roberta Metsola, to ditch U.S. software and hardware, as well as a U.S.-based travel booking tool. In Germany, politicians want a potential German or European substitute for software made by U.S. data analysis firm Palantir. “Such dependencies on key technologies are naturally a major problem,” Sebastian Fiedler, an SPD lawmaker and expert on policing, told POLITICO. Even in the Netherlands, among Europe’s more pro-American countries, there are growing calls from lawmakers and voters to ring-fence sensitive technologies from U.S. influence. Dutch lawmakers are reviewing a petition signed by 140,000 people calling on the state to block the acquisition of a state identity verification tool by a U.S. company. At the World Economic Forum in Davos, Switzerland, in late January, German entrepreneur Anna Zeiter announced the launch of a Europe-based social media platform called W that could rival Elon Musk’s X, which has faced fines for breaching the EU’s content moderation rules. W plans to host its data on “European servers owned by European companies” and limits its investors to Europeans, Zeiter told Euronews. So far, Brussels has yet to codify any such moves into law. But upcoming legislation on cloud and AI services are expected to send signals about the need to Europeanize the bloc’s tech offerings. ENERGY: TIME TO DIVERSIFY On energy, the same trend is apparent. The United States provides more than a quarter of the EU’s gas, a share set to rise further as a full ban on Russian imports takes effect. But EU officials warn about the risk of increasing Europe’s dependency on the U.S. in yet another area. Trump’s claims on Greenland were a “clear wake-up call” for the EU, showing that energy can no longer be seen in isolation from geopolitical trends, EU Energy Commissioner Dan Jørgensen said last Wednesday. The Greenland crisis reinforced concerns that the bloc risks “replacing one dependency with another,” said Jørgensen, adding that as a result, Brussels is stepping up efforts to diversify, deepening talks with alternative suppliers including Canada, Qatar and North African countries such as Algeria. FINANCE: MOVING TO EUROPEAN PAYMENTS Payment systems are also drawing scrutiny, with lawmakers warning about over-reliance on U.S. payment systems such as Mastercard and Visa. The digital euro, a digital version of cash that the European Central Bank is preparing to issue in 2029, aims to cut these dependencies and provide a pan-European sovereign means of payment. “With the digital euro, Europeans would remain in control of their money, their choices and their future,” ECB President Christine Lagarde said last year. In Germany, some politicians are sounding the alarm about 1,236 tons of gold reserves that Germany keeps in the Federal Reserve Bank of New York. “In a time of growing global uncertainty and under President Trump’s unpredictable U.S. policy, it’s no longer acceptable” to have that much in gold reserves in the U.S., Marie-Agnes Strack-Zimmermann, the German politician from the liberal Free Democratic Party, who chairs the Parliament’s defense committee, told Der Spiegel. Several European countries are pushing the EU to privilege European manufacturers when it comes to spending EU public money via “Buy European” clauses. Until a few years ago, countries like Poland, the Netherlands or the Baltic states would never have agreed on such “Buy European” clauses. But even those countries are now backing calls to prioritize purchases from EU-based companies. MILITARY INVESTMENT: BOOSTING OWN CAPACITY A €150 billion EU program to help countries boost their defense investments, finalized in May of last year, states that no more than 35 percent of the components in a given purchase, by cost, should originate from outside the EU and partner states like Norway and Ukraine. The U.S. is not considered a partner country under the scheme. For now, European countries rely heavily on the U.S. for military enablers including surveillance and reconnaissance, intelligence, strategic lift, missile defense and space-based assets. But the powerful conservative umbrella group, the European People Party, says these are precisely the areas where Europe needs to ramp up its own capacities. When EU leaders from the EPP agreed on their 2026 roadmap in Zagreb, they stated that the “Buy European” principle should apply to an upcoming Commission proposal on joint procurement. The title of the EPP’s 2026 roadmap? “Time for independence.” Camille Gijs, Jacopo Barigazzi, Mathieu Pollet, Giovanna Faggionato, Eliza Gkritsi, Elena Giordano, Ben Munster and Sam Clark contributed reporting from Brussels. James Angelos contributed reporting from Berlin.