President Trump speaks by phone ahead of NATO summit

The long-running Russia-Ukraine war appears to have entered a new phase after last weekend’s major developments and a tense North Atlantic Treaty Organization (NATO) summit.

In the past 72 hours, US President Donald Trump reportedly held separate phone calls with Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy, Ukrainian drones attacked oil terminals and ports in St. Petersburg and surrounding areas, and Russia launched its second major attack on Kiev in less than a week.

The risk of diplomatic escalation, as well as the potential for new diplomacy, is drawing investors’ attention as markets try to price in geopolitical risks, energy security, and the soundness of Europe’s defense spending commitments.

“There is a realistic prospect of ending this war, and America’s resolve is decisive,” President Zelenskiy said in a social media post on Saturday.

Ukraine’s president said he and Trump had agreed to continue talks at the North Atlantic Treaty Organization (NATO) summit after discussing the latest developments on the front lines after more than four years of conflict. Leaders from 32 countries are scheduled to participate in a two-day conference in Türkiye’s capital Ankara starting Tuesday.

Meanwhile, the Kremlin announced Sunday that President Trump had a 90-minute meeting with President Putin over the weekend, during which the president offered to help resolve the war.

Kremlin aide Yuri Ushakov described the meeting as “businesslike and very constructive,” according to Russian state news agency RIA Novosti.

“There is great potential for mutually beneficial cooperation between the two countries. To achieve this, President Donald Trump has emphasized that the conflict in Ukraine must be ended as soon as possible,” Ushakov told reporters.

A White House press secretary was not immediately available for comment when contacted by CNBC on Monday.

The US president, who repeatedly said during the 2024 election campaign that he could end the Russia-Ukraine war in one day if elected, has signaled that US support for Kiev could be renewed following the conclusion of an interim peace deal with Iran.

This suggestion, along with a series of successful barrage attacks by Ukraine, have led some analysts to conclude that the war may be shifting in Kiev’s favor, with President Putin recently acknowledging for the first time the impact of Ukrainian drone strikes on Russian fuel production.

Ukraine has stepped up attacks on Russian oil facilities and military assets in recent weeks, seeking to cut off Moscow’s energy revenues and increase political pressure on the Kremlin.

Ukrainian authorities reported that troops on Friday and Saturday attacked a major oil terminal in Russia’s second city, St. Petersburg, and the Kronstadt naval base, the main base of Russia’s Baltic Fleet. The attack reportedly caused fires at both an oil terminal and a military facility.

On Monday morning, further attacks on Russian energy infrastructure by Ukraine were reported. The Ukrainian military announced via telegram that it had attacked oil refineries in Russia’s Yaroslavl and Leningrad regions overnight. CNBC could not independently verify this report.

Russian missiles and drones struck the Ukrainian capital early Monday, killing at least 11 people and severely damaging a high-rise residential building, authorities said. The attack follows another deadly attack in Kiev last week, on the eve of a NATO summit.

Researchers at the Institute for the Study of War (ISW), a Washington-based think tank, cited Ushakov’s account of the call and said Putin was trying to emphasize that Ukraine’s European partners had a mistaken understanding of the realities on the battlefield.

Instead, Putin is said to have told Trump about the “real” front-line situation in which Russian troops were advancing, with Putin claiming that Russian forces had captured the eastern town of Kostyantynivka.

ISW said in its latest assessment that Russia’s claims of advances come as the Trump administration increasingly speaks publicly about Ukraine’s successes on the battlefield, including medium- and long-range attacks on Russian military assets and energy infrastructure.

“President Putin and other Kremlin officials are likely deliberately injecting false stories into the Western information space that Russian forces will soon occupy the rest of Donetsk Oblast in order to persuade the West to accede to demands that Russia cannot secure militarily,” ISW researchers said on Sunday.