Defense Briefing

Since February 28, 2026, the USA and Israel have been conducting joint air strikes against Iran with the stated goal of regime change. Iran has in turn fired over 500 missiles and 2,000 drones against Israel and US military bases in nine countries; over 870 people have been killed so far. The Strait of Hormuz is threatened, oil prices are rising rapidly, and the potential for regional escalation is significant.

Iranian APT groups are intensifying cyberattacks on water supply, energy networks, and telecommunications in the US and allied nations in parallel to the military conflict. Chinese actors such as Voltzite and Russian groups such as Electrum are actively mapping shutdown capabilities of Western power grids. The US cybersecurity agency CISA is weakened in personnel through budget freezes – precisely at the wrong time.

According to the new 2026 National Defense Strategy, the USA is shifting primary responsibility for Europe's conventional defense to NATO partners, as Europe is economically and demographically far stronger than Russia. NATO Chief Rutte is calling on European states to take the new 5% spending targets (3.5% core defense + 1.5% resilience by 2035) seriously, while Poland is even discussing its own nuclear capabilities – which Washington explicitly rejects. The July summit in Turkey is intended to shift focus from mere spending increases to targeted investments in drones, AI, and modern warfare technologies.

Ukraine has recaptured approximately 460 km² since the start of 2026 and is recording for the first time since the Kursk offensive of 2024 more territorial gains than Russia, which advanced only 123 km² in February – the lowest figure since April 2024. Zelenskyy has published captured Russian strategic documents proving offensive plans for Donetsk, Zaporizhzhia, and the Odessa region through 2027. Russia is nevertheless intensifying disruption of Ukrainian front-line defenses and is preparing a spring offensive according to ISW.

Prediction markets estimate the probability of a Ukraine ceasefire by end of March 2026 at only 2%, by mid-2026 at 16% – both in decline. Meanwhile, oil prices (Brent/WTI) are nearing the $90 mark due to the Iran conflict and the threat to the Strait of Hormuz (Polymarket: 76-100% probability). Markets assess the combination of ongoing Ukraine conflict and Iran escalation as a significant economic risk for Europe.