Western Unity on Full Display at Nato and G7 Summits, but Economic Tensions Lurk Beneath the Surface

US President Joe Biden hailed the Nato and G7 summits in Madrid and Germany, respectively, as a "historic" and "transformative" moment, with France's Emmanuel Macron describing it as "unprecedented for Europe since the second world war". The unity displayed among the Western leaders was palpable, with Boris Johnson, Britain's prime minister, emphasizing that the alliance was "totally united" in response to Russia's invasion of Ukraine. However, behind the scenes, officials struggled to hold a common line on energy sanctions, with the US pushing for a price cap on Russian oil to alleviate inflation concerns.

Key Takeaways:

• Nato has officially invited Sweden and Finland to join the alliance, a move seen as a sign of unity in response to Russia's invasion of Ukraine.
• The alliance has agreed to a sweeping rethink of its defense posture, including increasing the number of high-alert forces ready to repel a Russian attack more than seven-fold to over 300,000.
• China was for the first time characterized as a "challenge" to Nato's "interests and security", with leaders agreeing on language criticizing Beijing for siding with Vladimir Putin against Western condemnation of the war.
• The US has been privately urging the EU to consider imposing a ceiling on the Russian oil price, as an alternative to the partial embargo, but Germany has expressed caution about the idea.
• The G7 leaders failed to reach an agreement on a new sanctions mechanism to hit Russian oil revenues due to disagreements over how to tackle soaring inflation.
• Turkey's President Recep Tayyip Erdogan threatened to veto Sweden's membership in Nato, potentially reversing a decision to drop his opposition to its membership on the eve of the event.

Statistics:

• Over 300,000 high-alert forces will be ready to repel a Russian attack, an increase of over seven-fold from previous numbers.
• The war in Ukraine has killed tens of thousands of troops and civilians, displaced roughly a quarter of the country's population, and plunged the world into a series of growing crises.
• Consumer price inflation is running at over 8% in both the US and euro area, and a growing number of analysts fear a recession is around the corner.
• The US has been privately urging the EU to consider imposing a ceiling on the Russian oil price, as an alternative to the partial embargo.

Sources:

• Boris Johnson, Britain's prime minister, emphasizing the unity of the alliance in response to Russia's invasion of Ukraine.
• Emmanuel Macron, describing the unity of the Western leaders as "unprecedented for Europe since the second world war".
• Joe Biden, US President, hailing the Nato and G7 summits as a "historic" and "transformative" moment.
• Francois Heisbourg, special adviser at the Fondation pour la Recherche Strategique, a French think-tank, saying that the sanctions system continues to be reinforced.
• Theresa Fallon, director of the Centre for Russia Europe Asia Studies in Brussels, saying that the rhetoric of unity is "a lot of window-dressing".
• Mario Draghi, Italy's prime minister, forced to leave the Nato summit on Wednesday due to a crisis cabinet meeting.