The European Union (EU) has agreed to provide a massive loan package worth €90 billion ($106 billion) to Ukraine. The money will help Kyiv manage a growing budget gap over the next two years.

EU leaders finalised the deal after more than a day of intense talks at a summit in Brussels. The decision gives Ukraine urgent financial support as the war with Russia continues.

The move also comes at a time when US President Donald Trump is pressing for a quick settlement to end the conflict. EU Council President Antonio Costa confirmed the agreement publicly. “We have a deal. Decision to provide 90 billion euros of support to Ukraine for 2026-27 approved,” he wrote on X. “We committed, we delivered.”

Plan to use Russian frozen assets put on hold

Initially, EU leaders focused on using around €200 billion of Russian central bank assets frozen within the bloc. The idea was to generate a loan for Ukraine using those funds.

However, the plan stalled after Belgium raised objections.

Belgium holds most of the frozen Russian assets. It demanded firm guarantees on how financial risks and legal liability would be shared. Other EU countries found those conditions unacceptable, leading to a deadlock.

As a result, the EU dropped the proposal for now and moved ahead with a loan funded through other means.

Germany pushes asset plan despite setback

German Chancellor Friedrich Merz strongly backed the use of Russian assets. He argued it would send a powerful political message.

Even so, Merz said the final loan agreement still carries weight. He noted that the decision “sends a clear signal” to Russian President Vladimir Putin that Europe remains committed to supporting Ukraine.

Ukraine faces urgent funding gap

According to EU estimates, Ukraine needs an additional €135 billion ($159 billion) to keep its finances stable over the next two years. Officials warned that the funding shortage could begin as early as April, making quick action essential.

Without outside help, Kyiv risks struggling to pay salaries, pensions, and essential wartime expenses.

Zelenskyy urges EU to use Russian money

Ukrainian President Volodymyr Zelenskyy personally appealed to EU leaders at the start of the summit. He argued that using Russian assets was the right approach.

“Russian assets must be used to defend against Russian aggression and rebuild what was destroyed by Russian attacks. It’s moral. It’s fair. It’s legal,” Zelenskyy said.

Despite the delay, Ukraine still welcomed the loan decision. While Kyiv hoped for stronger action on Russian assets, securing financing through other routes offers much-needed relief.

What this means going forward

The loan now awaits implementation for 2026–27, but the broader debate over Russian assets remains unresolved.

EU leaders may revisit the issue later as legal and political discussions continue. For now, the agreement ensures Ukraine avoids an immediate financial crisis while the war drags on.