Von der Leyen vs Kallas: a European Clash amid Global Disorder
Good morning! We are David Carretta, Christian Spillmann and Oliver Grimm, and we are presenting you the Morning Post Europe. Parts of it are translated with the help of AI, but always edited by one of us.
Today’s analysis focuses on the clash between Ursula von der Leyen and Kaja Kallas over who should lead foreign policy. Yesterday the French foreign minister, Jean-Noël Barrot, warned the Commission president to respect the treaties. But, as Christian explains, behind this institutional struggle — unfolding amid global disorder — lies a deeper dispute between France and Germany.
In the briefings, we look at the support Europeans are ready to offer Gulf countries in the war in Iran, and the potential consequences for the European economy. Viktor Orbán and Vladimir Putin want to exploit rising energy prices to divide Europeans, while the loan to Ukraine risks remaining blocked at least until the European Council. In the European Parliament, the EPP has allied itself with the far right on migration.
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Von der Leyen vs Kallas: a European Clash amid Global Disorder
By Christian Spillmann
The European Union must rethink its foreign policy. Speaking yesterday in Brussels to the EU’s ambassadors, Commission president Ursula von der Leyen and the EU’s High Representative for foreign affairs, Kaja Kallas, offered the same stark diagnosis: international law is eroding and power is once again dictating the rules. Yet neither mentioned the role of Donald Trump in fuelling the current global turbulence. Nor did either say much about how the EU intends to position itself as the transatlantic relationship begins to fray.
Von der Leyen, in effect, acknowledged the end of the rules-based system. Kallas, by contrast, insisted that it must be restored — otherwise “we are doomed to see” chaos, she warned. But despite these differing instincts, neither leader explained how the EU intends to defend the multilateralism it claims to support. Instead, attention drifted to a more immediate question: redefining their institutional relationship. Put simply — who is in charge?
Into this delicate dispute stepped the French foreign minister, Jean-Noël Barrot. His intervention was a firm reminder: foreign policy remains the prerogative of the member states. The European External Action Service (EEAS) must remain independent and strong. The Commission president and the high representative, Barrot suggested, should each remain within their own remit. “I am aware of the institutional competition you face,” he told the ambassadors, warning of the risk that the EEAS could be reduced to little more than a directorate-general. “That is not the French conception of your role.” In a single sentence, the minister reminded von der Leyen of the limits of her authority.
The Commission president’s ambition to bring the high representative and her service firmly under the Commission’s wing has become an increasing source of tension. Barrot made clear that Paris would not accept such a shift. He went further, delivering a rather explicit legal lesson: the Commission must respect both the letter and the spirit of the EU treaties. Article 18 of the Treaty on European Union, Barrot recalled, is explicit: the high representative conducts the EU’s common foreign and security policy, submits proposals and implements them on the basis of a mandate from the Council.
In plainer terms, the message was unmistakable: Europe faces two major conflicts and the geopolitical consequences that follow. This is hardly the moment for a turf war over institutional prerogatives.
The Commission’s desire to bring the EEAS back under its control is not new. Until 2010, before the creation of the EEAS, external relations were handled within the Commission by a directorate-general. Von der Leyen has long shown a strong interest in shaping foreign policy. Yet her initiatives have often created friction within the EU. Although the Commission controls numerous external instruments — trade, humanitarian aid, energy and transport — member states have carefully avoided granting it full authority in foreign policy.
The real surprise of the day came from Kallas herself. Her predecessor, the Spaniard Josep Borrell, spent much of his tenure fighting to secure the resources and authority necessary to perform his role. The former Estonian prime minister appeared to strike a more accommodating tone. In her speech to the EU’s 148 ambassadors, Kallas presented what amounted to a restructuring plan justified by budgetary pressures. “Setting priorities necessarily means that in some areas functions we once carried out are no longer as essential,” she said.
The EU’s diplomatic presence will therefore be trimmed. “We we need to streamline our presence in the field toward greater relevance and to put our resources where they are most needed. We will be present but in some places with a lighter footprint,” Kallas explained, adding that this “modernisation” of the EU’s delegation network would begin as early as this year. The cuts will not stop there. Staff at headquarters will also be affected as the organisation seeks greater agility and flexibility in deploying personnel while respecting budget constraints. The next multiannual financial framework — the EU’s budget for the 2028-2034 period — appears already to have claimed its first victim.
France is unlikely to accept all this quietly. It is not yet clear whether Paris will intervene politically to support Kallas on resources. Barrot did not address the question directly. But he did make one thing clear: France will not allow the EEAS to be folded back into the Commission’s administrative structure.
Barrot sidestepped the broader political debate. “Nothing guarantees that the European Union will still exist in ten years,” he warned. “Our political organisation is in danger. Nothing is lost — but Europe will recover only if it can forge a new pact with its peoples, peoples who aspire to control their own future and to regain their sovereignty.”
The rest of his speech sounded like a direct rebuke to von der Leyen. European citizens, the minister said, will not accept capitulation in wars of aggression or passivity in trade conflicts. They expect the EU to protect them — to defend its borders and counter unfair competition, economic coercion, energy blackmail and foreign interference in democratic processes. Each line carried an implicit criticism of the Commission president’s reluctance to use the instruments already at the EU’s disposal against governments that resort to pressure and coercion in their external relations. Europeans expect the EU to hold its ground — and above all to know when to say no, Barrot warned: “No to the United States when they attack what is most intimate to us: our democracy or our territorial integrity.”
Behind this dispute lies a deeper divide. Not so much between Kallas and von der Leyen, as between France and Germany.
When von der Leyen argues that “Europe can no longer be a custodian for the old-world order, for a world that has gone and will not return,” the Commission president echoes the approach of the German chancellor, Friedrich Merz. “We can no longer rely on it as the only way to defend our interests or assume its rules will shelter us from the complex threats that we face. So we need to build our own European path and find new ways of cooperating with partners,” von der Leyen said. For Berlin, preserving the transatlantic relationship remains the overriding priority. During his meeting with Trump, Merz remained silent on the alleged violations of international law linked to the Israeli-American intervention against Iran aimed at toppling the mullahs’ regime. For critics in Paris and elsewhere, such caution amounts to a form of strategic subordination that several EU countries reject.
The Spanish prime minister, Pedro Sánchez, captured this sentiment with a pointed historical reminder. “In 2003, some irresponsible leaders dragged us into an illegal war in the Middle East that produced nothing but insecurity and suffering.” The unmistakable reference was to the divisions surrounding the 2003 invasion of Iraq. As then, Europe risks dividing itself once again. And this time Germany might find itself — at least in the eyes of some partners — on the side of those seen as too closely aligned with Washington.
Curiously, none of this surfaced in the speeches delivered by von der Leyen and Kallas about the emerging new world order.
The Quote
““If European buyers suddenly decide to reorient themselves and provide us with long-term, sustainable cooperation, free from political pressures, free from political pressures, then yes, we’ve never refused it. We’re ready to work with Europeans too”.
Russian President Vladimir Putin on oil and gas.
Geopolitics
Costa and von der Leyen offer diplomacy and naval missions to the Gulf — Dialogue, diplomacy, reinforced naval missions and humanitarian aid: these were the main messages sent by the leaders of the EU institutions — António Costa, Ursula von der Leyen and Kaja Kallas — during a videoconference held yesterday with leaders from the Middle East and the Gulf. The list of participants expanded in the hours before the call and included King Abdullah II of Jordan, Egyptian president Abdel Fattah el-Sisi, Bahrain’s crown prince Salman bin Hamad Al Khalifa, Lebanese president Joseph Aoun, Syrian president Ahmad Al-Sharaa, Armenian prime minister Nikol Pashinyan, Iraqi prime minister Mohammed Shia’ Al-Sudani, Qatari prime minister Mohammed bin Abdulrahman bin Jassim Al Thani and Kuwaiti prime minister Sheikh Ahmad Abdullah Al-Ahmad Al-Sabah. Turkey, the United Arab Emirates, Saudi Arabia and Oman were also represented, albeit at a lower level.
“The EU is a reliable partner” and “is ready to contribute in every possible way to help de-escalate the situation and facilitate a return to the negotiating table,” Costa and von der Leyen said. “Although the rules-based international order is under pressure, we firmly believe that dialogue and diplomacy are the only viable path forward.” The two EU leaders also said they were ready to “adapt and strengthen” the Aspides and Atalanta naval missions. Von der Leyen also announced the mobilisation of ReliefEU humanitarian aid stocks to support 130,000 displaced people in Lebanon.
French fleet deployed to guarantee freedom of navigation in the Strait of Hormuz — France has deployed the Charles de Gaulle, its nuclear-powered aircraft carrier, together with a force of ten warships in the Mediterranean so as to be ready “at the appropriate moment” to escort oil tankers and container ships through the Strait of Hormuz once it reopens to navigation, President Emmanuel Macron announced from the deck of the flagship of the French fleet.
This deployment has three missions: ensuring the safety of French citizens in the region and enabling their evacuation; honouring defence agreements with Cyprus, Jordan, Lebanon, Iraq, Qatar, the United Arab Emirates, Kuwait and Saudi Arabia; and guaranteeing freedom of navigation in the Red Sea and the Strait of Hormuz, currently closed, Macron said.
“When circumstances allow, we can imagine a mission with several European and Asian countries to escort oil tankers and container ships within a clear framework agreed with the parties concerned,” Macron explained. But “nothing indicates that the war will end in the coming days. It could last several weeks and we have prepared ourselves to endure,” the president added, outlining the parameters of French involvement. “France is not participating in the offensive. In this great disorder, France is acting methodically in a strictly defensive manner to ensure the protection of its citizens, the circulation of resources and to live up to its responsibilities. Nothing more.”
The risk of stagflation from the war in Iran — The economic impact of the war “will depend greatly on the duration and the regional scope of the conflict,” but in a prolonged scenario “it could end up generating a strong stagflationary shock”, economy commissioner Valdis Dombrovskis said yesterday ahead of the Eurogroup meeting. Finance ministers of the eurozone discussed the repercussions of the war in Iran.
In the most favourable scenario of a conflict lasting a couple of weeks, “it can be expected that it will not have significant effects on the global and European economy,” Dombrovskis said. A long war, with the blocking of the Strait of Hormuz and attacks on energy infrastructure in the Gulf, “could ultimately generate a strong stagflationary shock for the global and European economy, with higher energy prices feeding into broader inflation, negative effects on confidence, disruptions to supply chains and tighter financing conditions.”
According to Eurogroup president Kyriakos Pierrakakis, “the impact Europe may suffer from this crisis may manifest itself not only through energy prices but also through other variables: the cost of fertilisers, air traffic and even the indirect impact of financing conditions.”
The dilemma of strategic oil reserves — The Commission insists that, for the moment, there are no concerns or emergency situations regarding oil and gas supplies as a result of the war in Iran. “We are in a much better position than in 2022,” a Commission spokesperson said, as the institution prepares to present an energy package today aimed at “reducing electricity bills for citizens and businesses.”
Nevertheless, oil prices above $100 a barrel are causing concern. Economy commissioner Valdis Dombrovskis said that “one of the options being considered is also the release of oil reserves to increase oil supply during these disruptions coming from the region.” But for the G7 the moment has not yet arrived. “We are not there yet,” said French minister Roland Lescure after chairing a meeting of G7 finance ministers. Lescure did not rule out that a decision could be taken in the coming days “if necessary”. None of the G7 members has expressed opposition to releasing strategic stockpiles.
Orbán and Putin’s push to resume Russian hydrocarbon supplies — It may not have been coordinated, but the timing raises many suspicions. Viktor Orban and Vladimir Putin are using the surge in oil and gas prices caused by Trump’s war against Iran to try to push the EU to abandon its plan to phase out Russian hydrocarbons.
The Hungarian prime minister yesterday announced that he had written to Ursula von der Leyen asking for all restrictions on imports of Russian hydrocarbons to be lifted. “The Ukrainian blockade of oil now represents the most serious threat not only to Hungary and Slovakia but to the entire EU,” Orban said.
Putin has offered to resume supplies if Europeans declare themselves in favour of “a durable and stable partnership” that is “free of political considerations (...). We have never refused,” Putin said. In reality, at the beginning of the war it was Russia that drastically reduced gas supplies to the EU. The decision to completely ban all imports of Russian gas will not enter into force before the end of the year. A proposal to ban all imports of Russian oil has been postponed until after the elections in Hungary. But this has not prevented the Orban-Putin duo from trying to sow divisions among Europeans.
Ukraine loan risks ending up at the European Council — Today’s Ecofin meeting will provide an opportunity for some countries to put pressure on Hungary in an attempt to convince Viktor Orbán to drop his veto on the €90bn loan to Ukraine. As usual, support for Ukraine will be on the agenda of the meeting of EU finance ministers.
“Some ministers will raise the issue and the importance of reaching an agreement as soon as possible, given the urgency,” an EU diplomat told us. Hungary must quickly lift the veto “to be in a position to have the first disbursement in April”, the diplomat added. But hopes of convincing Orban are minimal. In all likelihood the issue “will be discussed at the European Council,” the source said.
According to our sources, Hungary is also continuing to block the renewal of individual sanctions against more than 2,700 people and entities placed on the EU blacklist for their role in Russia’s war of aggression. The sanctions expire on Sunday. The issue will be discussed at tomorrow’s meeting of ambassadors.
Hungary
Orbán increases the deficit to buy the election — The Hungarian prime minister is not limiting himself to attacking Ukraine and the European Union in an attempt to regain support ahead of Hungary’s elections on April 12. His government is also engaged in a massive spending operation for electoral purposes, according to data published yesterday by the economy ministry.
In February Hungary recorded its highest deficit since the Covid pandemic, when European governments were dealing with the consequences of lockdowns: 2.14 trillion forints, roughly €5.4bn. Measures adopted by Orbán include a lifetime income-tax exemption for mothers, mortgage subsidies and salary increases for public sector employees. According to independent polls, Orbán’s party, Fidesz, is trailing by nearly ten points behind Peter Magyar’s party, Tisza.
Migration
EPP breaks the cordon sanitaire and allies with the far right on returns — The European People’s Party yesterday chose to ally itself with the sovereignist Right and the Far Right in order to adopt a version of the returns regulation even tougher than that proposed by Ursula von der Leyen’s Commission.
The manoeuvre, organised by the French MEP François-Xavier Bellamy, was based on an agreement between the EPP and the European Conservatives and Reformists (ECR), the Patriots for Europe and the Europe of Sovereign Nations (ESN). Rather than supporting the compromise text backed by Socialists and Liberals, the party of Robert Schuman and Konrad Adenauer sided not only with Giorgia Meloni but also with Viktor Orbán, Jordan Bardella and Alice Weidel.
The Patriots group is triumphant, claiming “a stable right-wing majority in the European Parliament”. The result: 41 votes in favour, 32 against and one abstention. The plenary is expected to confirm the mandate to negotiate with the Council as early as this week.
The EPP had already voted with the far right on other migration measures. Socialists and liberals bear significant responsibility — not only because some of their MEPs aligned with the EPP’s choices. Their two leaders, Iratxe García Pérez and Valérie Hayer, have drawn no consequences after their red lines were crossed on key legislative dossiers.
Green Deal
Citizen energy communities remain a distant dream — The vision of a local-level EU energy revolution, with citizens, local authorities and small businesses producing and sharing more self-generated energy, remains far off due to a series of technical and legal obstacles, according to a report published yesterday by the European Court of Auditors.
The EU had set ambitious targets for energy communities. By 2030 they were expected to account for a significant share of Europe’s wind and solar capacity (17 per cent and 21 per cent respectively). By 2025 every municipality with more than 10,000 inhabitants was supposed to have at least one renewable energy community.
According to the Court of Auditors, progress is well below expectations. The number of energy communities and their contribution to green energy production have not truly taken off. EU guidelines remain unclear and limit broader participation by associations of apartment owners. In addition, delays in grid connections and the lack of incentives for energy storage are slowing down community energy projects.
Today’s Agenda
Ecofin
European Parliament: plenary session in Strasbourg (debates on the housing crisis in the EU; the single market; International Women’s Day; the European semester; the 2027 budget; the energy package; enlargement strategy; EU-Canada cooperation; flagship projects for European defence)
Commission: speech by President von der Leyen at the Nuclear Energy Summit in Paris
Commission: press conference by commissioners Ribera and Jørgensen on the energy package
European External Action Service: Ambassadors’ Conference 2026 (speech by António Costa)
European External Action Service: High Representative Kallas meets the foreign ministers of Albania, Ferit Hoxha, and Moldova, Mihai Popșoi
Commission: commissioner Tzitzikostas in Washington
European Parliament: President Metsola announces nominees for the European Order of Merit
European Parliament: press conferences by leaders of the political groups
European Parliament: press conference by Alex Voss on copyright protection in the age of AI
European Parliament: press conference by Borja Gimenez Larraz and Irene Tinagli on the housing crisis in the EU
Eurostat: data on temporary protection in January