Trump escalates with Europe and the Arctic race becomes a board-level risk (driving volatility in prices and freight)

Article series: Greenland 2026
Part 1: Board-level risk management | Part 2: Critical Minerals (strategic raw materials essential to advanced industries) | Part 3: Arctic trade routes and insurance

Executive summary

• In recent days, Greenland has shifted from a “remote” topic to the center of an open dispute between the U.S. and Europe, including tariff threats (import duties) and messages about dialogue frameworks and understandings with NATO (North Atlantic Treaty Organization).
• When a territory moves into the category of national security and great-power competition, business impact arrives fast: contracts, compliance (regulatory obligations), insurance, and logistics.
• “One more source” and “one more route” may be good news in the long run, but in the short run, they can increase volatility because key bottlenecks sit in processing (refining/separation) and insurance, not only in mining.
• At the end of the article, you’ll find a 90-day board checklist: exposure mapping, contracts, insurance, compliance, and scenario planning.

 

This is no longer an “Arctic story” — it’s a rolling crisis

Over the past week, Greenland has become a hot diplomatic and economic arena. Statements and threats around tariffs, alongside discussions and declarations tied to Greenland and the North Atlantic security framework, have turned the island into a symbol of great-power competition—not only over sovereignty, but also over supply chains, control of resources, and regional security.

If this feels “far away,” that’s precisely the risk: when geopolitics enters a supply chain, it doesn’t move at the pace of mining projects and infrastructure. It moves at the pace of regulation, financing, insurance, and compliance.

 

Why Greenland is “worth fighting over” right now: three forces converging

1) Minerals and resources: competition over the inputs that power advanced industries

Greenland is part of the global discussion on critical minerals (strategic raw materials essential to advanced manufacturing, defense, technology, and the clean-energy transition). The economic question is not only “what is in the ground,” but who controls the value chain: mining → processing → component production.

2) Arctic trade routes: an opportunity window with a warning label

The Arctic offers seasonal shipping windows—but these routes are volatile and condition-dependent. Even if a “new option” appears, it is not necessarily a stable substitute for existing routes, especially for companies running tight inventories and high-velocity global operations.

3) Security and geopolitics: when the environment turns militarized, safety, insurance, and compliance move fast

As the Arctic becomes a power arena, risk scenarios familiar from other regions—sanctions (economic restrictions), counterparty checks, export restrictions, and tightening insurance terms—can show up here too, sometimes faster than companies expect.

 

Competition with China and Russia: how the “race” itself can shift prices and freight costs

To understand Greenland’s business impact, focus on the competition mechanism—not only geology:

• Great-power competition increases the use of policy tools: sanctions (economic restrictions), export controls (licensing/limitations on exports), investment screening, and stricter origin documentation. Even when geological supply exists, commercial supply can be blocked or become more expensive.
• The market adds an “uncertainty premium”: prices are influenced not only by supply and demand but also by regulatory and security risk.
• On the logistics side, a “new route” can shorten distance—while increasing operational risk, rescue constraints, seasonality, and insurance pricing pressure.

 

Myth vs. reality: why “one more source” and “one more route” can increase short-term risk

The myth: “Greenland adds mineral supply + the Arctic adds a trade route = prices fall and risk declines.”
The reality: This may become true over the long term, but in the short term, two bottlenecks typically drive volatility:

Processing (refining/separation)

Across many critical minerals, the risk is not only in mining. It’s in processing and intermediate production. If processing capacity is concentrated among a small number of players, “one more mine” does not immediately translate into more usable industrial material.

Insurance and logistics

Arctic shipping routes are seasonal and volatile. Even where shipping is possible, the system depends on specialized vessels, infrastructure, rescue capabilities, and fit-for-purpose insurance frameworks—all of which create a risk premium.

A short operational example

Assume an Israeli company (or a multinational) manufactures an electronic or electro-mechanical component and depends on a material or sub-component currently sourced from China.

Even if a new non-China source opens in the future, during the first two years of a “transition period,” the following may occur:

• The new material is not yet available at a scale/quality/price suitable for serial production.
• The material may still require processing elsewhere (refining/separation), so the dependency remains at the bottleneck level.
• Great-power competition produces “regulatory noise”: more origin checks, more documentation, more licensing, and sometimes restrictions on transactions or partnerships.
• The market prices uncertainty: volatility in price and lead times (the time from order to delivery). 

The management takeaway: In a transition period, the risk is usually not “absolute shortage,” but volatility (price, lead time, insurance terms, and contract conditions).

 

What’s unique about Israel?

The playbook is similar for any global company, but Israel often faces specific pressure points:

• High-tech and defense-adjacent industries tend to be more sensitive to origin requirements, licensing, and export/import controls.
• Many Israeli firms operate as sub-suppliers to multinational supply chains (Tier-2/Tier-3, meaning second- and third-tier suppliers—not the direct supplier). Shifts in compliance requirements by EU/U.S. customers can cascade quickly to Israeli suppliers.
• Reliance on subcontractors in Asia means that changes in shipping/insurance/compliance risk can translate directly into product cost.

 

90-Day Board Checklist: Key Steps for Risk Management
The full checklist (including working tables) is available for download at the end of the article

1) Rapid exposure mapping (1–2 weeks)

• Build a list of the top 20 most critical materials/components (what stops production if missing).
• For each item: country of origin, country of processing, logistics route, and a clear picture of alternatives.
• Identify dependence on Tier-2/Tier-3 sub-suppliers.

2) Contracts and protection mechanisms (1 month)

• Ensure the right clauses exist and work in practice: force majeure (uncontrollable-event clause), sanctions clause (contractual protections tied to sanctions/compliance), price adjustment mechanism, and alternative-sourcing mechanisms.
• Reprice lead-time risk and service commitments.

3) Insurance and logistics (1–2 months)

• Review with broker/insurer: exclusions, premiums, and fit-for-purpose coverage for risk zones.
• Define a “route change” mechanism (re-routing, meaning switching the shipping route) and its cost/time implications.

4) Compliance and sanctions: no surprises at the bank (1 month)

• Update KYC (Know Your Customer) and KYCC (Know Your Customer’s Customer) in sensitive areas, especially maritime shipping and ownership/flag structures.
• Ensure origin documentation and the full counterparty chain meet bank/insurer requirements.

5) Simple management scenarios (1 month)

Define three scenarios:

• “Calm” (relatively stable pricing)
• “Volatility” (cost/time spikes)
• “Disruption” (major delays/tightening regulation)
  Then define triggers: insurance premium shifts, tariff changes, and tighter sanctions/licensing.

 

Conclusion

Greenland is a business indicator: it signals a period of great-power uncertainty that can raise volatility in prices and freight long before the long-term benefit of diversified sourcing shows up.

In Part 2, we will dive into critical minerals and the value chain (mining vs. processing). In Part 3, we will break down Arctic trade routes and the insurance/compliance landscape as an operational playbook.

To download the full board checklist (PDF) click here

Ofir Angel | Chairman, AUREN Israel

International expert advising boards & executive teams

on global strategy & geo-economic uncertainty

 

<strong>Selected sources (for further reading)

• Developments around tariffs/Davos and a NATO-related framework: PBS NewsHour (link)
• Critical minerals and supply-chain concentration: IEA (International Energy Agency), Global Critical Minerals Outlook (link)
• Arctic shipping reality and seasonality: Aker Arctic (link)