Bankova has opened the bidding in the peace talks by calling for a 30-day ceasefire and withdrawing from Russia’s Kursk region as an act of “good faith”. But both sides have adopted harder lines with little common ground as starting positions that is going to make it hard to thrash out an agreement.

Ceasefire: Ukrainian President Volodymyr Zelenskiy said his decision to accept a ceasefire was motivated by a desire to counter the narrative that he wants to “use” the US to pursue the war. He blamed Russia for pushing this narrative, but it was aimed more at US President Donald Trump than Russian President Vladimir Putin. It was Trump that claimed Zelenskiy was “risking WWIII” and didn’t want to stop fighting.

Bankova realises that the White House wants to stop the war, and quickly, and if Zelenskiy does not capitulate in some form, and soon, then the US will simply cut Ukraine off and force an end. As a result, Zelenskiy has to make some sort of concessions but has adopted as hard a line as he can to try and rescue something from the situation.

Kursk: Zelenskiy’s decision to withdraw from Kursk was forced on him. He is selling it as a gesture of good will, but in the last week, the Armed Forces of Russia (AFR) have broken through the Armed Forces of Ukraine (AFU) lines in the centre of the region and were threatening to encircle some 10,000 troops. Zelenskiy had no choice but to withdraw to save his men.

The withdrawal has been turned into a useful gesture that will encourage Trump but more importantly it also means that the AFU can relocate some of its best troops to shore up the defence of the Donbas, and Pokrovsk in particular, which is close to being overrun by the AFR. The Kursk incursion has failed in its main goal – to provide a territory card to trade with Russia in talks – but has in the end provided a useful card to play in Bankova’s negotiations with the US.

Sovereignty & land: Putin now has the upper hand in the talks. He has gone back to his earlier hard position of insisting that not only does Bankova concede de facto control over Crimea and the four regions annexed in 2022, but now he is insisting again that Bankova recognises them as Russia’s sovereign territory de jura as well. Ironically it is Putin who is worried about a second war, not the West, which still argues that the danger is Russia will use the ceasefire to rearm ahead of a second, more effective, invasion. Given after three years of war, Russia has not been able to capture more than 20% of Ukraine, facing off a vastly inferior Ukrainian army, the idea that Russia will be able to take not only all of Ukraine, but also be strong enough to take on the whole EU after say a two year pause, is risible.

What Putin is afraid of is a post-Trump pro-Ukraine US administration taking over and restarting what the US has repeatedly called its “cheapest war ever” and simply with the goal of running down Russia’s military might and depleting its economy. If Putin agrees to a ceasefire then he wants a frozen conflict that stays frozen, as despite Russia’s military power, it is not powerful enough for a ”forever war”.

Pretty much everyone agrees that Crimea is gone forever, but Zelenskiy has said that conceding the sovereignty of the four regions of Donetsk, Luhansk, Kherson and Zaporizhzhia is a non-starter for him. These are clearly Ukrainian lands (especially Kherson, which is partly on the western bank of the Dnipro) and Russia doesn’t even control all of their territory.

Both leaders have hardened their position over the status of the four regions. As part of the 2022 Istanbul peace deal it was agreed the issue of the sovereignty of the regions would be kicked down the road and it was even suggested that they might be granted autonomous status, but remain inside Ukraine as Ukrainian sovereign lands, but in effect giving Moscow de facto control over them by stacking the local legislature with pro-Russian politicians. Moreover, at the end of last year, trial balloon leaks from the Kremlin suggested there was “limited wiggle room” for territorial concessions and the Kremlin was open to freezing the fighting along the line of contact and would not demand Kyiv concede the entire administrative territory to Moscow, including the land it doesn’t control. That compromise seems to have disappeared in the first comments from the Kremlin after the 30-day ceasefire proposal was announced.

However, given both sides have already agreed, in principle, to several versions of a solution to the status of the annexed regions, it seems probably that there is still significant wiggle room for compromises. Given Putin can concede, say, control over the territory he does not control, and needs a ceasefire, some sort of compromise appears to be possible.

Nato & security guarantees: Another major “major red line” for Zelenskiy is his ongoing insistence on some sort of security guarantee for Ukraine – preferably accelerated Nato membership (or partial Nato membership – the so-called Western Germany scenario), and failing those, bilateral guarantees by the likes of the UK and France or a “coalition of the willing”.

The Kremlin is flat out against Nato membership of any form. This entire war began as the US refused to consider the “ironclad guarantees” of no-Nato from the start with the eight-point list of demands issued by the Russian Ministry of Foreign Affairs in December 2021 and then in the January 2022 rounds of diplomatic talks in the run up to the war.

Surprisingly, while the Kremlin won’t compromise on Ukraine’s Nato membership, it made it clear during the Brest peace talks in April 2022 it has no objection to bilateral security guarantees (or Ukraine’s EU membership – that’s just business). These do not include stationing Nato troops or weapons in Ukraine, only a commitment for British or French troops to fight alongside the AFU, should Russia invade for a second time – something they will be extremely reluctant to do.

The head of Ukraine’s presidential office, Andriy Yermak, repeated the demand for security guarantees after the talks in Jeddah broke up this week, but unfortunately for Bankova, not only will Ukraine not, and will never, be offered Nato membership, the European powers have already made it crystal clear they will not offer real bilateral security deals either.

That leaves only one choice: Ukraine has to return to the neutrality enshrined in the 2014 constitution. However, Zelenskiy has nailed his flag to this particular flag post, and he is unlikely to climb down. That makes it more likely that the White House will see him as an obstacle to peace and work hard to organise elections to oust him, as part of its three-stage plan that starts with a ceasefire, followed by presidential elections and only then agreeing on the terms of a permanent ceasefire. Agreeing to revert to neutrality would be easy for a new president and Ukraine already gave up its Nato aspirations. This would be the effective Finlandisation of Ukraine. Zelenskiy has already said he is willing to step down, but only if his departure comes with Nato membership.

Demilitarisation & peacekeepers: The Kremlin’s rejection of any form of Nato membership also rules out Western peacekeepers as they are in effect a Nato military presence on Ukrainian soil. The one possibility could be Chinese or Brazilian peacekeepers, oddly suggested by Trump himself as an alternative, although Brazilian President Luiz Inácio Lula da Silva has already ruled that out.

The idea of peacekeepers has been championed by French President Emmanuel Macron and backed by UK Prime Minister Keir Starmer, but it is simply a half measure, suggested by Paris and London as a show of support for Ukraine, without making the commitment to anything more than the “security assurances” they have already offered.

Russian Foreign Minister Sergei Lavrov has already flatly rejected even the suggestion of the wholly inadequate 30,000 mooted force, and no one is talking about the 120,000 to 200,000 force to cover the 1,200km-long line of contact needed to make this idea work.

There is no room for compromise on either Nato membership or peacekeepers in any form.

A related tricky point in the negotiations is Putin’s insistence on demilitarising Ukraine. Russia is insisting on strict limits on the size of a post-war Ukraine’s military. In theory this can be done as similar terms were agreed as part of the 2022 Istanbul agreement but in practice it will be difficult. Zelenskiy has said that if there are no security deals then the alternative is to build “our own Nato” – a very large and powerful army of around 1.5mn men.

This time round Zelenskiy is very unlikely to agree to significantly downsizing the AFU as the AFU will be the only real security guarantee Ukraine has. Finland did the same thing following its defeat by Soviet forces and today has the only really combat-ready army in Europe that could give the AFR a run for its money.

However, there is a fairly easy workaround to this problem. Kyiv could agree, on paper, to limit the size of its standing army, but at the same time continue the massive investment into its defence industry together with its foreign partners on the Danish model that has already been established, and at the same time massively expand national service.

This will almost certainly happen anyway and there is little the Kremlin can do to stop it.

Ukraine’s military production was up by some 500% in 2024 y/y and it already produces 40% of the materiel it needs, up from next to nothing in 2022. It is particularly strong in drone production and has already become both a world leader in not only drone production but in innovations too.

Drones were pioneered by US president Bill Clinton but were mainly used as a tool of assassination. It was Turkey that pioneered the use of drones as an assault weapon, used to devastating effect in the short war between Azerbaijan and Armenia in 2020. Ukraine has embraced this cheap low-tech drone technology and taken it to new levels, using it to mitigate the chronic lack of artillery shells; half of the battlefield deaths in the current conflict are caused by drones and campaigns for cities like Bakhmut, Avdiivka and now Pokrovsk, that should have taken weeks to complete, drag on for 8-9 months with appalling loss of life to the Russian side.

Ukraine has already gone a long way to building up its defence sector, following a conference in 2023 when Zelenskiy said that he wanted to turn Ukraine into a military production hub, and today Ukraine produces some $2bn worth of drones, but is capable of $20bn a year if export restrictions were removed.