Arctic Blitz: Why Trump is willing to sacrifice Ukraine for a deal with Putin

Ukraine as an ‘Arctic asset’

While the US administration is twisting Kyiv's arms, demanding that it agree to the peace scenario that Donald Trump is trying to negotiate with Putin, little is known about the plan itself. However, it is becoming increasingly clear that it is not so much about peace in Ukraine as about a broader 'deal' Trump seeks to strike with Vladimir Putin – one in which Ukraine is more of an 'asset' for Trump than a party to the agreement. This likely explains why Trump has consistently denied Ukraine the peace terms that Kyiv and Europe see as essential. Instead, he has shown a willingness to make unlimited concessions to Moscow while blackmailing Kyiv into signing an imposed and unfavourable peace agreement.

The deal is supposedly aimed at a more important and expansive goal for Trump – to ‘detach’ Russia from China by offering it a framework for large-scale US-Russian cooperation. In doing so, one of its arenas will be cooperation in the Arctic. According to Bloomberg sources, in Riyadh the discussion focused on the exploration of Arctic natural resources and the development of trade routes (this was also mentioned by Kirill Dmitriev, head of the Russian Direct Investment Fund and husband of a friend of Putin’s daughter, whom Putin appointed ‘special representative for investment and economic cooperation with foreign countries’). At the same time, the Bloomberg source confirmed that US officials see the plans as a way to drive a wedge between Moscow and Beijing.

In reality, the Arctic has long been seen in the United States as a field of strategic rivalry with Russia and China. The US Geological Survey estimates that the Arctic could contain, in addition to various other minerals, more than 10% of the world’s undiscovered oil reserves and more than 30% of its undiscovered gas reserves. However, these and other attractive figures – generated in large part by the Arctic debate – are based on probabilistic estimates, meaning they refer not to actually confirmed reserves. It remains to be determined in which parts of the region these resources lie hidden. More precise data may emerge soon, as the melting of Arctic ice is opening up new opportunities for shipping and exploration. According to some forecasts, year-round navigation in the Arctic Ocean could become possible as early as the end of this decade. Therefore, in the coming years, tensions in the region will only increase in parallel with its growing attractiveness.

Trump’s obsession with Greenland, which he has threatened to either buy or annex, is also, evidently, connected to his fixed Arctic idea. Greenland, or rather Denmark on its behalf, claims almost 900,000 square kilometres of the Arctic shelf (which, in turn, explains Greenland's intensified desire for independence). Canada, which Trump refers to as the '51st state,' and Russia initially each claimed 1.2 million square kilometers of the shelf, but later expanded their claims to 2 million square kilometers. All three 'claims' on the Arctic partially overlap, especially around the North Pole. Formally, the decision falls under the purview of the United Nations. Last year, the UN Commission on the Limits of the Continental Shelf confirmed the validity of most of Russia’s claims. But this is not the final word – the claims of other countries must also be considered. Meanwhile, the United States has not ratified the United Nations Convention on the Law of the Sea, which governs this process, so it cannot formally participate in the contest. However, last year they unilaterally declared their claims (about 1 million square kilometres).

As can be seen from this, most of Trump's most controversial statements and actions, including those concerning Greenland, Canada and the US withdrawal from the UN, should be interpreted as part of his Arctic strategy. Moreover, his approach to the Ukrainian issue is also largely determined by this strategy: in a sense, Ukraine looks like his ‘bargaining chip’.

Who is the main rival?

Although Trump’s focus on the Arctic may be somewhat obsessive, in this matter he is generally following a strategic logic that was formed during the Biden presidency, one which assumes that the main rival of the United States in the Arctic is China. In the US Arctic strategy published last year, China, which has no direct access to the region but calls itself a ‘near-Arctic state’, was given more attention than Russia, whose claims extend over a significant part of the Arctic shelf.

The strategy notes that the rift with the West is forcing Russia to more actively develop cooperation with China, including in the Arctic region. Under these new conditions, China has become the main buyer of Russian energy resources, with more than 80% of natural gas and about 20% of oil being extracted by Russia specifically in the Arctic, and it can be assumed that, sooner or later, China will claim a share in these projects, while Russia, in its isolated state, will be unable to implement new Arctic projects on its own. Washington’s concerns are further fueled by the developing military cooperation between China and Russia in the region. The strategy specifically notes that in 2022 and 2023, Chinese Navy and Russian Navy ships conducted operations in international waters off the coast of Alaska, and that the Chinese Coast Guard and Russian FSB signed a memorandum of understanding. The Pentagon believes these actions open up opportunities to expand Chinese presence in the Arctic and along the Northern Sea Route.

At a briefing on the publication of the Arctic Strategy, US Deputy Secretary of Defence Kathleen Hicks called China ‘the only strategic competitor that has the will and increasing ability to reshape the international order’. The risks posed by Russia are assessed more cautiously. According to Hicks, Russia 'continues to pose an acute threat to security and stability in the region.' And this is a significant shift in American policy that remains a subject of debate. In the previous 2019 strategy, China was also mentioned but was not the main focus. In 2022, an article published in the Journal of Indo-Pacific Affairs, entitled ‘Why China is not an equal competitor in the Arctic,’ argued that Beijing is doomed to remain in the second tier among the players vying for a presence in the Arctic.

This opinion is advanced in an article in Foreign Policy by experts from the Norwegian Institute for Defence Studies, Jo Inge Bekkevolda and Paala Sigurd Hilde. The new American Arctic strategy is dedicated not so much to the Arctic as to China and Alaska as one of the key points of American-Chinese rivalry in the Indo-Pacific region. The United States is overly focused on this issue, while the more pertinent risks emanating from Russia are being ignored.

Experts point out that Beijing still has a very limited political, economic, and military presence in the Arctic. Its numerous attempts to establish cooperation with all the Arctic powers, except Russia, have proven unsuccessful. Even in Greenland, China did not achieve anything, despite its genuine interest in the island, notes Patrick Andersson, an analyst at the Swedish National China Centre. In 2016, Beijing considered the possibility of purchasing a closed Danish naval base, and in 2018 it sought to participate in the modernisation of Greenland’s airports. Copenhagen blocked both projects on security grounds. Several attempts to engage in mineral exploration have also failed.

In the Russian Arctic, China has taken part in only one large-scale project — supplying equipment for Arctic LNG-2. However, the latest sanctions imposed by the US under Joe Biden blocked this work as well. China's ambitions to create the so-called Ice Silk Road through the Arctic Ocean are not backed by concrete plans. Its military activity is limited to short-term visits at Russia’s invitation.

Chinese investment in the Russian Arctic

Is there room for a wedge, and is there even a wedge?

Arctic relations between Russia and China are, in fact, far from ideal. The approaches of Moscow and Beijing to the Arctic have proven so divergent that their differences could not be overcome even after China became Russia’s most important partner, writes Chinese foreign policy researcher Andrei Dagaev in an article for Carnegie Politika. In its foundational documents (the Arctic Policy White Paper released in 2018 ), China insists that the Arctic is the common heritage of all humanity. Accordingly, the PRC has the right to utilise its air and maritime spaces on an equal footing with other 'constructive participants.' Russia, for its part, in the 'Fundamentals of State Policy in the Arctic until 2035’ emphasises 'ensuring sovereignty and territorial integrity.' In developing the region economically and militarily, it intends to rely on its own capabilities. This difference in approaches, in particular, hinders joint efforts on the Northern Sea Route, notes Dagaev. Russia regards it as a national transport corridor, whereas China wishes to see it as part of the Ice Silk Road – an international project in which Russia should not play the role of the senior partner. Moreover, investing in this project only makes sense if it includes European ports – the necessary investments cannot be recouped through Russia-China trade alone.

The notion that the primary competition will unfold between the United States and China is a theoretically possible scenario, write experts at the RAND research centre. However, for that to happen, Russia would have to radically revise its strategy in the region, handing over the keys to China while retaining the role of gatekeeper. At present, there are no signs that Russia is willing to take that path, analysts believe. Yet if, in the near term, it remains an outcast in the global economy and politics, then at some point it will have to agree to Chinese terms to some extent.

But can the US offer Russia a better deal? US-Russian cooperation in the Arctic is nothing new, Politico reminds us. In 2011, ExxonMobil and Rosneft formed a joint venture (with the American company holding a 33% stake) for exploration in several areas of the Kara Sea. As a result, in 2014 the 'Pobeda' field was discovered, with reserves of 130 million tons of oil and 500 billion cubic meters of gas. However, its development was hindered by sanctions imposed on Russia in response to the annexation of Crimea. In particular, these sanctions blocked the transfer of offshore technology. ExxonMobil and Rosneft also had plans to work in the Chukchi Sea and the Laptev Sea, but due to the sanctions, those projects also failed to materialise. Moreover, since even the Kara Sea project was in its very early stages, ExxonMobil only wrote off $200 million when it exited the venture—a relatively small loss compared to the $4.6 billion it had to write off after Vladimir Putin, in 2022, by decree seized the company’s stake in the Sakhalin-1 project, which ExxonMobil had been developing with Rosneft for two decades. However, if the United States lifts or eases sanctions against Russia, ExxonMobil is likely to become one of the obvious candidates for a return, according to John Gotthorpe, an analyst at research firm Argus Media. Before the war, the company maintained good relations with the Russian authorities and Rosneft. Therefore, it is most likely a direct stakeholder in Trump’s Arctic deal.

However, can such cooperation be expanded? Right now it may seem laughable, but the largest Russian gas field, the Shtokman field, was originally planned to become a Russian-American project to produce and deliver liquefied gas to the US. Yet no one ever embarked on developing the field, while the US began investing in shale production and became its largest exporter. This episode merely demonstrates that the profitability of Arctic developments remains unclear and unproven.

Another equally important question regarding the prospects of a Putin–Trump deal is whether Russia will be able to withstand pressure from China, which currently accounts for more than a third of Russia’s foreign trade turnover. As we have already noted, in order to tear Russia away from China, it is necessary to once again shift Russia’s trade flows from east to west (→ Re:Russia: The Politics of Twitter Dilettantism), and to restore European trading partners. Meanwhile, the current mood in Europe is not very conducive to this.

To implement the Arctic deal, Trump will not only need to 'hand over Ukraine,' but also force modern European politicians to submit, and then overcome that colossal gravitational field of economic and political interdependence that currently underpins the unequal alliance between Russia and China. There is a risk that, as has repeatedly happened with Trump’s 'deals,' only the first point will be fulfilled.