GTBT - US Taps Into Ukraine's Raw Materials

: Hubert Walas; Created: 27 March 2025

Between peace and raw materials - a new installment of the Russian-Ukrainian war.

Trump's '100 days to peace' has now dwindled to just 77. While the clock is ticking, beyond mere declarations, there are still no visible signs of an approaching breakthrough. Alleged peace proposals keep leaking to the media, though their premises are so unrealistic and aligned solely with Russian interests that they most likely represent ongoing propaganda efforts and attempts to soften the opponent.

Ironically, we continue to observe more tools being developed to pressure Russia, in line with the 'peace through escalation' policy. This includes discussions about tightening the sanctions noose around Moscow's neck, the transfer of additional Western-made combat aircraft to Ukraine, and even Trump's consideration of acquiring raw materials from Ukraine, including rare earth metals. Meanwhile, drones continue to strike Russian refineries, with China quietly observing it all.

Ukraine's Wealth

The wealth of Ukrainian lands is a topic that has surfaced numerous times in the context of the war in Ukraine. We dedicated an entire episode to this subject, produced even before the war broke out. Ukraine possesses substantial reserves of valuable minerals, including elements essential for the new technological revolution - rare earth metals.

Some hearing this information go as far as to conclude that resources were the main (somewhat hidden) motive behind Putin's Russia's invasion of Ukraine. While this is quite a bold hypothesis, considering that Russia itself is a resource hegemon unable to properly utilize its wealth, it's nevertheless not a trivial argument.

Thus, when Ukraine's position in the war began to waver, and Donald Trump's return to power in the United States became increasingly likely, many analysts, including ourselves and individuals connected to the Ukrainian government, began to propose the possibility of access to or preferential collaboration in extracting these resources. This was also one of the points in the "Victory Plan" proposed by Kyiv in autumn. It took less than two weeks of Trump's presidency for him to "take the bait" and express interest in Ukrainian resources, though this characterization isn't entirely accurate. It implies deception, while in reality, this could be a mutually beneficial arrangement.

Trump would certainly agree that he "doesn't like to be a sucker." Ukraine represents a distant conflict for him that interferes with business dealings, and he distances himself from the moral aspects of the situation, delegating the issue to people like Kellogg. He has the right to do that. However, when it becomes apparent that he could secure concrete benefits from the situation, Trump becomes all ears.

"U.S. President Donald Trump said on Monday that he wants Ukraine to supply the United States with rare earth minerals as a form of payment for financially supporting the country's war efforts against Russia," Reuters reports. This would serve as compensation for the support provided to Ukraine, which Trump estimated at $300 billion. Within days, Trump raised the amount Ukraine had allegedly agreed to to $500 billion. For accuracy, let's note that the State Department reports that aid to Ukraine totals $93 billion since February 2022, or $163 billion if we include assistance since 2014 - the beginning of Russian operations in Crimea and Donbas.

Beyond rare earth metals, it's reasonable to assume Trump is interested in Ukraine's substantial deposits of uranium, lithium, and titanium. However, none of these rank among the world's top five reserves, and the United States has its own untapped reserves of these and other critical minerals. Nevertheless, it's important to remember that America remains dependent on China for rare earth metals.

The details of such an agreement remain unclear. Who would extract these resources? Under what terms? For how long? Despite these uncertainties, American interest alone benefits Ukraine. From Kyiv's perspective, any move that draws Trump deeper into the matter and engages his transactional nature is desirable. So much so that Ukrainians are reminding Trump that accessing the full scope of Ukraine's resource base would require enabling Kyiv to reclaim occupied territories, where the lion's share of these resources is located.

Another angle Kyiv is pursuing involves Trump's evident interest in the Nobel Peace Prize. Successfully and responsibly bringing peace to Ukraine would undoubtedly provide grounds for such an award. Nevertheless, 'Responsibly' is the key word here, as the Stockholm Committee would certainly consider the peace terms imposed by Americans.

Olaf Scholz has launched into a moral analysis of Trump's approach, criticizing the transactional attitude as 'self-centered.' Surprisingly, Kremlin spokesman Dmitry Peskov offered a sobering assessment: 'Simply put, Washington's offer to Kyiv is a proposal to purchase aid. That is, rather than continuing to provide it free of charge, it would be provided on commercial terms.'

Who maintains the moral high ground in this situation? Trump's America with its egotistic-transactional approach that openly articulates its demands? Or Scholz's moralizing Germany, which contemplates returning to Russian gas once the war ends, while continuing to expand its gas infrastructure?

Difficult Position

Meanwhile, Zelenskyy's cabinet must prepare for peace talks, regardless of Kyiv's diplomatic success with Washington. In conversation with Piers Morgan, Volodymyr Zelenskyy acknowledged that Ukraine is in a better negotiating position today than at the start of the war, though it remains very challenging. He's also realistic about the prospects of recovering stolen territory: 'We don't have the capability to do this now,' he said. But he added they won't betray fallen soldiers by conceding this territory as Russian. 'The occupation is temporary. There are no compromises on sovereignty,' he added.

The Ukrainian president shared casualty estimates, stating that Russia has lost approximately 350,000 soldiers, with 50,000 to 70,000 missing. About 600,000 to 700,000 Russians were reportedly wounded. Ukraine, in his assessment, lost 45,100 soldiers and has around 390,000 wounded. Counting both dead and wounded would give a ratio of 3:1. While information from any side of the conflict should be treated with caution, these figures sound plausible. Military textbooks typically estimate aggressor losses at about three times those of defenders.

Making rough calculations and assuming Ukraine has 28 million inhabitants, with half of men constituting those between 25-60 years old, we get about 6.5 million people. This means 6% of those eligible for conscription are dead or wounded. For Russia, the comparable ratio, using the above data, is about 3%, though Moscow is notably more willing to draft teenagers. Notably, Russian casualties in 2024 likely exceeded those of 2022 and 2023 combined.

It's therefore unsurprising that Zelenskyy accepts the prospect of upcoming peace talks and doesn't hide it. 'Ukraine is closer to peace than ever before in nearly three years of full-scale war,' he said, adding that he believes Europe should also have a place at the negotiating table. Who will represent Europe? Historically, it would likely be Olaf Scholz and Emmanuel Macron. The absence of Central and Eastern European representatives seems probable, despite being verbally and economically Ukraine's strongest supporters in this war, though the region's negotiating position is weak. From this perspective, the CEE region and Zelenskyy's cabinet should push for the presence of Kaja Kallas, the new EU foreign policy chief and a staunch Ukraine supporter, at the negotiations.

Though talks are approaching, Trump's 100-day timeline seems increasingly unlikely with each passing day. While the Ukrainian leader assures that American aid (contrary to rumors) hasn't been halted, it's undeniably dwindling. Current aid transfers originate from the Joe Biden administration era.

'Of the approximately $45.8 billion sent to a separate "drawdown" fund approved in the last Congress, only $3.8 billion remains - about 8%,' reports the Kyiv Independent. So the 'well' is running dry. Trump, wanting to maintain some leverage before negotiations, will be forced to announce another aid package for Ukraine. This, again, conflicts with his campaign message, which attacked Ukraine support and polarized society. Narratively, however, this can be easily resolved by tying support to the aforementioned 'resource agreement.'

Significantly, Kyiv hasn't wasted the war's three years regarding military complex development. Today, Ukraine produces 40% of the weapons it uses in the war, the highest so far. Kyiv has increased military drone production tenfold in just one year.

Ukrainian armed forces currently use 200,000 drones monthly, compared to 20,000 in early 2024, according to Lieutenant General Ivan Havryliuk, First Deputy Minister of Defense of Ukraine.

Notable support also arrives from other directions - firstly from France. Paris has delivered the first Mirage fighters to Ukrainians. They are to be equipped with previously available SCALP/Storm Shadow long-range missiles and French AASM Hammer guided bombs. How many Mirages do the French intend to transfer? The exact number is unknown, but currently, 26 such aircraft are in use, intended for replacement by more modern Rafale aircraft. An additional 40 units are grounded and could serve as potential 'parts donors.' Any support for modest aviation is good news for Ukrainians. Moreover, during the same period, the Dutch delivered another tranche of F16s to Ukrainians. How many do Ukrainians currently have? Again - unknown. Probably between a dozen and two, maybe 30, of which most likely two have been lost. Current estimates indicate that Ukraine will receive a total of 95 F-16 aircraft and the mentioned two dozen Mirage aircraft.

It's worth mentioning the package from Israel, which is in the process of transferring Patriot batteries along with 90 missiles. Israeli warehouses reportedly still contain 7 batteries that have been decommissioned and could potentially reach the Dnieper.

Russian refinery fires have become a recurring pattern. According to Ukrainians, they have hit 16 of Russia's 20 largest refineries. Most refineries suffered varying degrees of damage. Some are inoperative for several weeks, while others remain shut down for many months.

Recently, on February 3rd, facilities in the Volgograd and Rostov regions fell victim. Base, a Russian Telegram news channel closely linked to Russian security services, reported that Lukoil's refinery in Volgograd was hit. The 300,000-barrel-per-day refinery is the largest such facility in southern Russia. In 2023, it processed 13.508 million metric tons of crude oil, or 4.9% of total Russian refinery processing volume. In recent days, Ukrainians also attacked the Afipsky refinery in Krasnodar.

The Alleged Peace Plan Leak

How long will this all continue? Russians believe until 'Victory Day' on May 9th. New iterations of allegedly leaked peace plans keep appearing in the infosphere. The most publicized one was released by 'strana.ua'. According to this plan, the Russians aim to announce peace by the symbolic date of May 9th, with a ceasefire taking place by Easter, which falls at the end of April this year (thus fitting within Trump's 100 days).

Generally, the 'leak' reiterates many previous demands, primarily accommodating Russian claims, including:

Russia retaining occupied territories
Ukrainian withdrawal from Kursk
Ukraine's exclusion from NATO
Lifting of sanctions
Guarantees for protecting Russian population and language, including the Russian Orthodox Church
No mention of reparations

Then we have demands that could be characterized as 'Trump's vision,' essentially shifting costs to Europe:

A peacekeeping mission in Ukraine involving tens of thousands of European soldiers
Europe bearing the cost of Ukraine's reconstruction, estimated at 400 billion euros

What would Ukraine gain from this plan?

Vaguely defined American military support (likely paid for with resources), but without NATO membership

The plan accommodates all Russian demands while shifting costs to Ukraine and Europe, simultaneously positioning Americans as the ultimate arbiters. Hence, many suggest this is another Russian attempt at floating 'trial balloons' and thus represents preemptive narrative shaping.

Even if we assume the Americans could force Ukrainians to accept these terms (which nothing currently indicates), they would simultaneously need to somehow compel Europeans to bear essentially all costs of a war initiated by Russia. Current estimates for Ukraine's reconstruction costs exceed $400 billion. The problem is that as Trump's America withdraws from its global commitments and questions NATO, it's unclear how they could force European governments to meet their expectations. If Trump wants to withdraw from Europe, the natural leverage over European countries that have previously benefited from the 'American security bubble' also disappears. Add to this that Europe and America are already entering a quasi-trade war, further reducing Trump's influence over the EU.

If Trump truly wants to end this war quickly, he'll need to consider European interests in some form. From the Old Continent's perspective, sending hundreds of billions of dollars for Ukraine's reconstruction while simultaneously giving their main eastern adversary time to rebuild their potential and threaten Europe again sounds like a poor arrangement, to put it mildly. A cheaper and more effective solution would then be for Europe to step more firmly into American shoes and take over 'leadership' in the war from Uncle Sam, aiming for continued degradation of the (hostile) Russian State through Ukrainian hands. Perhaps with the definitive intention of overthrowing the current Kremlin regime and negotiating with new authorities that would meanwhile emerge in the cracks of the crumbling system. However, then Trump wouldn't end the war as promised, and the Kremlin could fall - also contrary to the American administration's original intentions. These are, of course, far-reaching speculations that would require political will and effective European remilitarization policy, but they show that even if Americans and Russians agree to certain terms, if they're unenforceable in Europe and Ukraine, such an arrangement won't hold.

Indeed, there's a growing consensus in the analytical community that even if some document is signed, the 'peace' or 'ceasefire' mentioned in it will largely be an empty slogan without proper safeguards.

Some might say our equation doesn't account for the final element influencing the outcome - the China factor. China's position is the most ambiguous. Let's look at Beijing's perspective from a different angle:

The war somewhat depletes American resources
The war is happening far from China's borders
The war has pushed Russia into complete dependence on China
The war allows Beijing to play the issue among Global South populations
The war weakens Europe, China's potential economic prey

As we can see, one can easily list several factors suggesting that the continuation of the Russian-Ukrainian war serves Chinese interests.

Some might argue that the collapse of Putin's regime isn't in China's interest. True. However, with increasing dependency, the elites operating in the Kremlin will become secondary to the Chinese. Already, significant figures in the Russian government apparatus are increasingly dissatisfied with the government's servile relations with China, which are seen as 'transforming the country into a resource colony' and threatening economic crisis, as ChrisO reports via the VChK-OGPU channel.

If a hypothetical new leadership tried to distance itself from China, they would be backed into a corner - regardless of who sits on Moscow's throne. A policy of breaking away from China requires restoring full, or at least 'pre-war' relations with Europe - which will be difficult, even if it's already being discussed behind closed doors. The question remains whether, after catching their prey, the Chinese would ever want to release it from their grip.

Trump confirms that 'serious peace negotiations' are already underway. But it's not words that indicate their current progress, but actions. These aren't going smoothly, considering Keith Kellogg wants to press Russia with sanctions on a scale we haven't seen yet. The retired general soberly assesses the effectiveness of the current sanctions level at 3 on a 10-point scale.

'We can really tighten sanctions - especially the recent ones [targeting oil production and exports],' said Kellogg. Recently, the entire highest cabinet of the American government reportedly met to consider how to use all available elements of power to end the war as quickly as possible, Kellogg said. Europe is also joining the trend, considering intercepting Russian tankers belonging to the 'shadow fleet.'

As predicted, the closer we get to a potential end of the war, the more areas of escalation we observe. Five actors have significant involvement in the war (Ukraine, Russia, USA, Europe, China). Each is engaged at a different level, has different resource levels, and is driven by different interests. Considering this and the scale of the war - this is an extraordinary situation. And extraordinary situations require extraordinary solutions. Therefore, unless Donald Trump finds a 'golden mean' for each side (if one exists at all), little suggests that peace will come as quickly as planned.

Sources:

Hubert Walas

Founder of Good Times Bad Times, author.

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US Taps Into Ukraine's Raw Materials

Ukraine's Wealth

Difficult Position

The Alleged Peace Plan Leak

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