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Explainer-What could a Ukraine peace deal look like?
Published by Global Banking & Finance Review®
Posted on October 17, 2025
5 min readLast updated: January 21, 2026
Global Banking & Finance Review®
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Published by Global Banking & Finance Review®
Posted on October 17, 2025
5 min readLast updated: January 21, 2026
The article discusses potential outcomes of a Ukraine peace deal, focusing on territorial control, NATO membership, and security guarantees.
By Guy Faulconbridge and Olena Harmash
MOSCOW/KYIV (Reuters) -U.S. President Donald Trump has said he will meet Russian President Vladimir Putin in Budapest soon to discuss a way to end the war in Ukraine.
What might a peace deal look like?
WHO WOULD GET WHAT?
Russia controls more than 116,000 square km (44,800 square miles), or more than 19% of Ukraine, an area just under half the size of the United Kingdom, according to the Russian military.
Russia says Crimea, which Moscow took in 2014, Donetsk and Luhansk - together known as Donbas - as well as Zaporizhzhia and Kherson are now legally parts of Russia.
Three sources familiar with Kremlin thinking said after Putin's August summit with Trump that Putin has demanded that Ukraine withdraw from the parts of Donetsk that Ukrainian forces control - around 20%, about 5,300 square km.
That is less than his original 2024 demand for Kyiv to cede the entirety of Donbas plus Kherson and Zaporizhzhia in the south, an area of nearly 20,000 square km.
Russia wants Western leaders to recognise Crimea, which was handed to Ukraine in 1954 by Soviet leader Nikita Khrushchev, as part of Russia, citing their recognition of Kosovo as independent in 2008 against the wishes of Russia and Serbia.
Ukrainian President Volodymyr Zelenskiy has acknowledged that some Russian-occupied territories might be recognised as temporarily de-facto occupied but has ruled out any de jure recognition. He says he does not have a mandate to give away territory and that any withdrawal would expose both Ukraine and its European allies to new Russian attacks.
WHAT ABOUT NATO?
One of Putin's most important conditions for ending the war is a demand that Western leaders pledge in writing to stop enlarging the U.S.-led military alliance NATO eastwards; Russian officials cite an assurance to that effect from U.S. Secretary of State James Baker to Soviet leader Mikhail Gorbachev in 1990.
NATO leaders agreed in 2008 that Ukraine and Georgia would one day become members and Ukraine has enshrined the path to NATO and the EU in its constitution. It says any change would have to be agreed in a referendum, an unlikely prospect.
Trump has said that previous U.S. support for Ukraine's NATO membership bid was a cause of the war, and has indicated that Ukraine will not get membership.
NATO says it is up to individual countries whether they want to join the alliance but that it is not discussing NATO membership for Ukraine but rather a security guarantee.
HOW WOULD SECURITY GUARANTEES WORK?
Ukraine wants a way to guarantee that it will not be invaded again, but the West is anxious not to sign up to anything that could lock it into a future war with Russia, the world's biggest nuclear power. The EU and NATO have so far focused on practical support, infrastructure readiness, and strategic deterrence.
Russia is keen to resurrect a draft agreement from April 2022 envisaging permanent neutrality for Ukraine in return for security guarantees from the five permanent members of the U.N. Security Council: Britain, China, France, Russia and the United States.
Ukraine and its European allies have said Moscow is not a reliable guarantor and neutrality for Ukraine would leave Europe exposed.
Moscow has also demanded limits on Ukraine's armed forces and protection for Russian speakers and Orthodox believers. Kyiv rules out any limits on its armed forces and says Russian speakers already have all the protections they need, citing the fact that the first language of Zelenskiy himself is Russian.
TRADE PROSPECTS AND FROZEN ASSETS
After speaking to Putin on Thursday, Trump mentioned the prospect of resuming U.S.-Russia trade if peace was achieved. Many in Washington have been troubled by the "no limits" partnership between Putin and China's Xi Jinping - and have proposed trying to bring Russia closer to the United States.
Particularly important for Russia would be the ability to use the U.S. dollar in global transactions and the opening up of Western financial institutions to Russian money again.
European powers are searching for a way to finance Ukraine's defence and reconstruction with some of the 210 billion euros worth of Russian sovereign assets frozen in the West.
Russia says that taking that money would be theft and would undermine confidence in the euro as a reserve currency and trigger years of legal - and other - reprisals. Moscow has suggested some of the money be spent on rebuilding the areas of Ukraine that Russia controls.
CHILDREN
U.S. first lady Melania Trump said she had secured an open line of communication with Putin about repatriating Ukrainian children caught up in the war with Russia. Ukraine has already been working with help from Qatar to free some children and has expressed hope more can be released.
(Reporting by Guy Faulconbridge in Moscow and Olena Harmash in Kyiv, additional reporting by Andrew Gray in Brussels; Editing by Philippa Fletcher)
NATO, or the North Atlantic Treaty Organization, is a military alliance established in 1949 for mutual defense among its member countries, primarily in Europe and North America.
Crimea is a peninsula located on the northern coast of the Black Sea, which was annexed by Russia in 2014, leading to international disputes and tensions.
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