Trump's surprise strikes on Iran and renewed Greenland demands upended a NATO summit meant to showcase allied defense spending, as Brent crude surged 8% to $80.41 and European allies worked to keep the US president engaged.
Back
NATO summit shifts focus as Trump launches 8 strikes on Iran
Trump's surprise military strikes on Iran and renewed demands for Greenland control upended a NATO summit designed to showcase alliance unity, as European allies scrambled to keep the US president engaged.
ANKARA — President Donald Trump launched a series of strikes on Iran late Tuesday and revoked a license allowing Tehran to sell oil on global markets, dramatically shifting the focus of a NATO summit meant to highlight allied defense spending increases and support for Ukraine.
The strikes came after three merchant ships were hit in the Strait of Hormuz, a chokepoint that handles about 21% of global oil trade. Brent crude surged more than 8% to $80.41 a barrel, while US West Texas Intermediate rose nearly 8% to above $70, as Trump declared the US-Iran ceasefire "over." Global equity markets also fell, with AI stocks leading declines amid renewed geopolitical uncertainty.
"The US forcefully reacting was totally crucial," NATO Secretary-General Mark Rutte said Wednesday in Ankara, defending the strikes as a necessary response to Iran's ceasefire violation. Rutte has worked to maintain Trump's support by publicly praising the president and playing down public fights.
The summit's agenda had been built around the "Trump Trillion" — the $1.2 trillion that European allies and Canada have added to defense spending since Trump took office in 2017. NATO members agreed last year to invest 5% of gross domestic product on defense, with 3.5% on budgets and 1.5% on infrastructure. New figures released Tuesday showed Slovenia, Belgium, Spain and the Czech Republic still struggling to meet the alliance's old 2% GDP target, putting them at odds with the Trump administration.
Trump used a meeting with Turkish President Recep Tayyip Erdogan to complain that Italy, Germany and France had refused to grant open access to their bases for US forces to attack Iran. "Why are we spending hundreds of billions of dollars and they're not there for us?" Trump said.
Defense spending and the Greenland dispute
Rutte hosted a "big reveal" event showcasing billions in new defense procurement deals, much of it flowing to US companies. Lockheed Martin will establish a Patriot missile sustainment facility in Europe, part of $3 billion in new defense investments with American firms announced at the summit. Trump also said the US intends to lift CAATSA sanctions on Turkey, potentially reopening discussions on Ankara's participation in the F-35 fighter jet program.
But Trump reopened old wounds by insisting the US should control Greenland from NATO ally Denmark. Danish Prime Minister Mette Frederiksen rejected the demand Wednesday, saying "Greenland is of course not for sale" and that Denmark is "ready to defend every inch of NATO, including our own territory." Iceland's Prime Minister Kristrún Frostadóttir called for unity, noting that "Russia is the biggest threat when it comes to these NATO allies."
The last time a US president made a territorial claim against a NATO ally was unprecedented in the alliance's 77-year history. NATO is founded on the principle that its 32 members will defend each other's territory, not threaten to seize it.
Ukraine and the path forward
Ukrainian President Volodymyr Zelenskyy made a fresh appeal for NATO membership, arguing that his forces are "eliminating" an average of 30,000 Russian troops every month and have demonstrated the ability to strike deep inside Russia. He is expected to meet with Trump in Ankara on Wednesday.
The Pentagon has launched a six-month review of US force presence in Europe, and drawdowns could depend on how fast allies increase defense spending and whether they allow greater use of their bases. European allies and Canada are still seeking clarity on how deeply Trump intends to cut US force numbers.
Trump will also meet with Syrian President Ahmad al-Sharaa, a former insurgent who led the offensive that unseated Bashar Assad in December 2024. Trump has suggested al-Sharaa could help root out Hezbollah in Lebanon, though the Syrian leader has said he has no interest in doing so.
For markets, the key question is whether the Iran escalation remains contained or draws in broader regional forces. The Strait of Hormuz disruption alone threatens to keep oil prices elevated, while defense sector equities could benefit from sustained NATO spending commitments. The next scheduled NATO ministerial meeting is set for December.
This article is for informational purposes only and does not constitute investment advice.
[1] NATO Sets a Lower Bar for Success: Keeping Trump Happy - WSJ[2] The NATO summit was supposed to focus on defense spending. Trump's strikes on Iran changed that - AP News[3] Danish PM says her country is 'ready to defend' Greenland as Trump joins NATO leaders in Turkey - The Sun Chronicle[4] NATO summit day two: Trump, defense push, arms to Ukraine and threats to Iran (As it happened)[5] EXPLAINER - What are CAATSA sanctions and what could lifting them mean for Türkiye?