Transcript: Should western troops go to Ukraine?

This is an audio transcript of the FT News Briefing podcast episode: ‘Should western troops go to Ukraine?’

Marc Filippino
Good morning from the Financial Times. Today is Wednesday, February 28th, and this is your FT News Briefing.

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The FT got a look at Russia’s criteria for a nuclear strike, and French President Emmanuel Macron opened up the possibility of sending western troops to Ukraine. Plus, oil and gas profits have tripled during the Biden presidency, but the industry says he’s dangerous. I’m Marc Filippino, and here’s the news you need to start your day.

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Russian military files leaked to the FT revealed what it would take for the country to use tactical nuclear weapons. The threshold is lower than Russia has ever admitted publicly, like if another country destroyed 20 per cent of Russia’s strategic ballistic missile submarines. These tactical nuclear weapons are meant for limited use on a battlefield in Europe and Asia. Then there are also larger strategic weapons that would target the US. The documents also describe training exercises on how to deal with an invasion from China, which is pretty interesting given how close the countries have grown over the past two decades.

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Emmanuel Macron won’t rule out sending troops to Ukraine. The French president said the idea was discussed at a summit on Monday in Paris, but other European leaders at the meeting were quick to dismiss it. Here to talk to me about Macron’s comments and what else happened at the meeting is Henry Foy. He’s the FT’s Brussels bureau chief. Hi, Henry.

Henry Foy
Hi, Marc.

Marc Filippino
All right, so who was at the Paris meeting?

Henry Foy
So this was a meeting of between 20 and 25 western leaders, mainly European leaders. So quite a high-level conference. And this was Macron’s idea to try to show that western resolve behind Ukraine was unwavering. And that if Russia thought it could outlast the west, it was wrong.

Marc Filippino
So the big headline from that meeting, as I said, was that Macron didn’t rule out sending troops to Ukraine. What was the reaction from other European leaders?

Henry Foy
The response from fellow European leaders was pretty swift. The Germans, the Italians, the Poles, the big sort of military powers all came out saying this is a non-starter. We do not agree. And certainly, our troops are not going to be sent to Ukraine. In response, afraid to say, well look, we’re not saying this is gonna happen, but it’s important to put it on the table. And I think, Marc, that’s the key message here. Macron is trying to create some kind of strategic ambiguity vis-à-vis Russia, just to remind Russia that this is not a linear process towards their victory in Ukraine. And the western powers do have other levers that they could pull if indeed they chose.

Marc Filippino
I mean, does Russia buy that, though?

Henry Foy
Well, Russia’s response was both predictable and factual. They said if Nato troops are deployed in Ukraine then it would be inevitable that a full-scale war between Russia and Nato would break out. I mean, that’s what happens if you’re in a mutual defence pact, as Nato is. However, there is, of course, a lot of nervousness still — even two years on — that this war could escalate into something far bigger involving Nato and other European countries. So there’s not the appetite there. But what Macron is trying to say is like, look, we need to put these options on the table even if we don’t use them.

Marc Filippino
Henry, I want to talk about something else that came out of the meeting regarding Ukraine. Paris had been really opposed to buying emergency artillery supplies from outside the EU, and on Monday it dropped that position. What do you make of that?

Henry Foy
That’s correct. And this is something that other European allies of France have been pressurising Paris to do for months and months and months. Ukraine needs artillery shells right now. They’re being out-fired by Russia by around three to one each day. And that’s having a really, really detrimental effect on Ukraine’s ability to hold the line. The long-term aim is for Europe to have a bigger, more robust, and ultimately, more productive artillery industry of its own. The problem is European factories are basically contracted out to 2025. There is no excess production that can be paid for with more money. And so what Macron said was, OK, we are now willing, given the inability to spend any more money in Europe, to buy shells from other countries outside the EU, countries that have large artillery production lines and spare capacity.

Marc Filippino
What is your overall takeaway about how France came out of these meetings? Is it much different than the way they went in?

Henry Foy
I think France was under a bit of pressure going into the meeting, certainly from Germany, who has by far and away spent the most money on supporting Ukraine militarily in Europe. And what German ministers were saying in their rebuttals to Mr Macron’s comments was don’t talk about putting troops on the ground, just send more weapons. What France wanted to do was change the narrative on that and look more at what’s the bigger impact these countries are having. In that regard, Macron is something of a Trump card. He’s really the only leader in Europe who can stand up and make these big, sweeping strategic announcements and get people to listen and take him seriously.

Marc Filippino
Henry Foy is the FT’s Brussels bureau chief. Thanks, Henry.

Henry Foy
Thank you so much.

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Marc Filippino
US oil and gas producers have seen their profits nearly triple during Joe Biden’s presidency. But the industry calls his administration hostile and is warning that a second term would be disastrous. Here to explain the disconnect is the FT’s Houston correspondent Myles McCormick. He covers the energy sector. Hi, Myles.

Myles McCormick
Hey, Marc.

Marc Filippino
So why has there been such a huge boom in profits during the Biden administration?

Myles McCormick
The basic reason, Marc, is the price of oil. So oil took a dip in the latter part of Trump administration. And as a result of the Covid pandemic, the recovery from that and the kind of growing demand coming out of Covid has pushed up the price of oil. And then you had Russia’s invasion of Ukraine, which led to all sorts of restrictions on supply which further sent it higher.

Marc Filippino
So it sounds like the high profits don’t really have anything to do with Biden.

Myles McCormick
No. The fundamental reason for it is supply and demand driving high prices.

Marc Filippino
Gotcha. So why is the industry making so much noise about Biden then?

Myles McCormick
The main reason the industry is kind of kicking off, I suppose, is because from their point of view, it could be a lot better under a more pro-oil administration. The Republicans and Donald Trump in particular have vowed to unshackle the industry should he return to office, rip up regulation and make it easier for them to do whatever they want to effectively.

Marc Filippino
So, Myles, what have Biden’s oil and gas policies looked like?

Myles McCormick
So Biden’s oil and gas policies have yo-yoed a little bit. So he campaigned for office on probably the most ambitious climate agenda of any presidents in history. On coming into office, he imposed various restrictions on the oil and gas industry, but then subsequently he dialled them back as he sought to kind of tamp down on inflation. He wanted oil and gas companies to drill more in order to combat Russia’s influence in Europe in the wake of the Ukraine war. He wanted gas shippers to ship more LNG abroad. But then, I mean, subsequently, as we come into an election year, he’s taking a harder line again on the industry, freezing new permits for LNG terminals and restricting offshore licences. So the industry is kind of up in arms again about the administration and accusing it of suffocating the industry.

Marc Filippino
Myles, what do analysts say about this whole thing?

Myles McCormick
Analysts’ take on it is that fundamentally, whoever the occupant of the Oval Office is has a limited impact on the profit that oil and gas companies make in the near term. They can affect the long run by restricting leases for long-term oil and gas production. But in the near term, what happens to oil and gas companies’ bottom lines is dictated by the oil price. And that’s a result of fundamental supply and demand factors.

Marc Filippino
Myles McCormick covers energy for the FT from Houston. Thanks, Myles.

Myles McCormick
Thanks, Marc.

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Marc Filippino
You can read more on all of these stories at FT.com for free when you click the links in our show notes. This has been your daily FT News Briefing. Make sure you check back tomorrow for the latest business news.

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