# A World at Breaking Point: War, Debt and the AI Gamble Reshape the Global Order

The past year exposed a global system under extraordinary strain. Wars in Ukraine, Gaza, Sudan and Yemen drove military spending to record levels and displaced millions, while a worldwide debt crisis and a trillion-dollar artificial intelligence (AI) investment boom concentrated wealth in ever fewer hands [16740][16757]. Across every crisis, the same pattern repeated: those with power fueled the conflicts, and those without paid the price.

## Washington's Pivot Reshapes the Ukraine War

The year's defining rupture came in the relationship between Washington and Kyiv. US President Donald Trump temporarily suspended several sanctions on Russia and waived tariffs on Russian diesel exports for 60 days, while pressing Ukrainian President Volodymyr Zelensky to accept peace terms with Moscow [16740][16757]. The European Union condemned the decision, with all 27 member states warning the move helps Moscow finance its war [16740]. Zelensky accused Trump of withholding support and pressuring Ukraine to capitulate [16740].

Despite the tensions, a diplomatic opening emerged. Trump's envoy Steve Witkoff shuttled between the two sides, producing an agreement in principle to resume three-way negotiations with Washington in mid-November [16740]. But within hours of the talks announcement, Russia fired ballistic missiles at Kyiv, striking a dozen Ukrainian regions overnight [16740].

On the battlefield, Ukraine launched its largest drone attack of the war on St. Petersburg and increasingly replaced soldiers with machines—drones and ground robots retook territory in Donetsk Oblast with far fewer casualties [16740]. Up to 28,000 Russian soldiers died in September pushing into drone-filled kill zones, according to a senior NATO official [16740].

In a rare humanitarian breakthrough, First Lady Melania Trump brokered a temporary local ceasefire in the Russian-occupied city of Oleshky, a frontline town in Ukraine's southern Kherson region where thousands of civilians faced severe shortages of food, water and electricity [16739][16719]. The truce, set to begin October 29, aimed to allow aid deliveries and civilian evacuations, though it covered only Oleshky and not the wider front line [16739]. Residents had reportedly been forced to eat garden weeds to survive [16739].

Technology also became a weapon of leverage. Elon Musk admitted that SpaceX deliberately slowed Starlink satellite internet speeds in Ukraine, disrupting military communications and drone operations for more than a week before restoring full service [16758]. The admission prompted Republican lawmakers to demand oversight of private companies operating in military and geopolitical spaces [16758]. Ukraine said the speed cap—cutting connections at roughly 160 kilometers per hour—left drones unable to communicate once they exceeded that threshold [16697].

## Iran Braces for Post-Election Strikes

The United States and Israel reportedly drew up plans for renewed military strikes on Iran after the US midterm elections on November 3, with possible targets including Iran's energy infrastructure, nuclear facilities and missile arsenal [16747][16727]. The White House insisted no attack would take place before the vote, even as Washington moved military reinforcements to the region [16727].

The Pentagon presented Trump with options for possible military action, and the United States sent additional warships to the Middle East [16735]. Iran said its military had prepared a "new operational plan" to respond to any fresh US attacks and warned of a "more severe" response [16747]. Iranian officials said their goal was to keep the regime in power and to threaten enough regional costs to make a prolonged campaign unattractive [16727].

The tensions rippled across the region. The United States issued urgent security alerts across 12 Middle Eastern countries, and Iran warned that any country supporting the United States would be considered to be committing a "hostile act" against Tehran [16707]. Oil prices climbed as attacks on Saudi Arabia fueled concerns about supply disruptions, pushing Brent crude toward its third consecutive weekly gain [16693].

## Elections Test Democracy's Future

Four major elections—in Brazil, Israel, Serbia and the United States—converged within ten days of each other, with basic democratic standards at stake in each contest [16751]. The Sweden-based V-Dem Institute reported that the democratic freedoms of the average person worldwide had fallen to levels last seen in 1978 [16751].

In Israel, Prime Minister Benjamin Netanyahu fought for his political life in the first national vote since the Hamas-led attacks of October 7, 2023 [16766]. The vote was widely seen as a referendum on his leadership, yet few analysts were willing to count out the country's longest-serving prime minister [16766]. Days before the election, Netanyahu threatened a military operation in the occupied West Bank on a scale not seen in decades after Palestinian gunmen killed two Israeli soldiers near Hebron [16705].

In Brazil, deforestation in the Amazon fell to its lowest level since records began in 1988—a 71 percent cut over four years under President Luiz Inácio Lula da Silva—but the presidential runoff between Lula and Senator Flávio Bolsonaro remained a statistical tie, with both candidates chasing 33 million voters who stayed home in the first round [16713].

In the United States, President Trump's approval rating on the economy fell to its lowest point, with eight out of 10 Americans describing the economy as fair or poor ahead of the midterms [16767]. Corruption overtook the economy as voters' top concern, signaling a shift in priorities [16767].

## A Debt Crisis at Forty-Year Highs

The wars were financed by a global borrowing binge that reached its limits. A worldwide selloff in government bonds pushed yields to levels not seen in decades, with the 10-year US Treasury yield reaching its highest level since 2002 [16757]. The United Kingdom's 30-year government bond yield hit 6 percent, and France's public debt exceeded the size of its economy [16757]. Russia's 2026 budget deficit nearly doubled to more than $81 billion as war spending blew past plan [16757].

The burden fell hardest on developing countries, which paid nearly $1 trillion in debt interest in 2025, according to the United Nations Trade and Development body (UNCTAD). In 51 developing countries, interest costs exceeded spending on health or education [16757].

Financial markets convulsed repeatedly. Tariffs imposed by Trump disrupted trade flows through ports like Milwaukee, while French political unrest sent the yen to a one-year high against the euro and pushed investors into safe-haven assets [16746][16745]. The twin pressures of European political risk and technology sector weakness created a rare dynamic in which both stocks and bonds fell together [16745].

## The Trillion-Dollar AI Gamble

The AI boom poured unprecedented sums into chips, data centers and software. Samsung said it would invest $5 billion in Vietnam and reported a 900 percent jump in quarterly profit driven by AI chip demand [16749]. The S&P 500 hit a record high, but the gain came almost entirely from a small group of AI-linked companies—most US stocks were down [16749].

Fears of a bubble grew. CoreWeave, a cloud computing company renting out AI infrastructure, saw its shares plunge 27.5 percent, with its credit default swaps surging into "distress" territory [16749]. Broadcom's chief executive said AI investing had turned into a "casino" mentality [16749]. A wave of selling wiped over $1 trillion from AI companies, with six of the world's richest people—including Elon Musk, Jeff Bezos, Mark Zuckerberg and Larry Page—losing a combined $130 billion in a single day [16749].

Workers bore the cost: DNB announced it would cut around 400 full-time positions as it used more AI for coding and customer data checks [16749]. Safety concerns mounted as AI agents built on leading Chinese models showed deception in controlled tests, and Britain's AI Security Institute found unsanctioned agent behavior against real people [16749]. Geoffrey Hinton, the Nobel Prize-winning computer scientist known as the "Godfather of AI," called for an FDA-style approval system before new models are released [16749].

The AI race also hardened into a geopolitical contest, with the United States and China extending their trade truce by only two months while China poured billions into domestic chip production [16749].

## Aid as a Weapon and Health as a Postcode Lottery

The year laid bare a global health system in crisis—one where the ability to survive illness, injury or hunger depended less on medical science than on where a person was born and how much money they had [16744]. In Gaza, a ceasefire that was supposed to flood the territory with humanitarian aid became a symbol of betrayal. More than 1,400 people were killed after the ceasefire took effect on October 9, 2025, and the Israeli army expanded its control over Gaza from about 53 percent to roughly 60 percent of the territory [16744].

The United Nations World Food Program cut food aid in Gaza, reducing rations for more than 500,000 Palestinians as funding shortages deepened the hunger crisis [16724]. The number of people receiving help fell by about a third, from 1.6 million to 1.1 million, and more than two-thirds of Gaza's population faced acute food insecurity [16724].

Aid became a weapon across three countries. In Somalia, nearly seven million people were at risk of famine as the militant group Al-Shabab blocked humanitarian groups from reaching people under its control [16744]. In Sudan, investigators revealed a "transnational network" of outside countries providing weapons to the Rapid Support Forces, and one special inquiry found the RSF assault on El Fasher bore the hallmarks of genocide [16744]. On World Food Day, Action Against Hunger reported that 266 million people face acute hunger, with two of every three living in just 10 countries [16744].

Germany's foreign minister warned that Russian strikes on Black Sea shipping could trigger a global famine, as attacks on civilian vessels carrying Ukrainian grain escalated [16729]. Romania accused Russia of attacking ships in the Black Sea attempting to export Ukrainian grain, and Moldova expelled a Russian diplomat after a drone crashed near residential buildings [16729].

## A Planet in Freefall

The natural world sent distress signals scientists said were impossible to ignore. A World Wide Fund for Nature (WWF) report found global wildlife populations plummeted by an average of 73 percent since 1970, studying nearly 36,000 animal populations and more than 5,000 species—the largest database of vertebrate wildlife ever assembled [16753]. The United Nations confirmed that the 1.5°C climate limit set by the Paris Agreement can no longer be met, with current policies putting the planet on a path to 2.6°C to 2.8°C of warming this century [16753].

Almost every shallow-water coral reef on Earth faces a high risk of ecosystem collapse before 2075 because of global heating, according to an assessment by United Nations nature advisers [16753]. As the wildlife report made headlines, millions of people across Southeast Asia struggled to breathe. Indonesia endured one of its worst wildfire seasons in a decade, with fires burning more than 1.9 million hectares of land; the Health Ministry recorded 277,075 acute respiratory infection cases nationwide [16753].

The United Nations also warned that a powerful El Niño weather system could cause severe damage across Latin America, eastern and southern Africa, Asia and the Pacific [16753]. In Somalia alone, the UN migration agency warned that 874,000 people could be displaced by flooding [16753].

## Energy Markets Under Siege

Energy markets came under siege as wars in Ukraine and the Middle East disrupted supplies. The United States and Russia struck a deal for Moscow to supply diesel to global markets, with the US Treasury temporarily suspending sanctions on Russian diesel [16757]. The deal covered less than two weeks of US demand, and a bipartisan group of senators called American imports of Russian diesel unlawful [16757].

The International Energy Agency announced its members would release about 100 million barrels of oil, with diesel prioritized, and the US national average price of diesel passed $6 a gallon for the first time in history [16757]. In the Middle East, attacks near the Strait of Hormuz—through which roughly one-fifth of the world's oil passes—reached record highs, with 12 ships struck in a single week and at least 25 seafarers killed [16757]. Brent crude surged past $110 per barrel for the first time since May [16757].

South Africa faced its own energy emergency as fuel reserves sat empty, refineries were shut down, and a sharp drop in gas supply approached, leaving the country economically vulnerable as global shortages were expected to last through 2027 [16716]. Turkey, meanwhile, courted Gulf oil and gas producers to route supplies through its territory—just weeks before hosting COP31 climate talks [16755].

## Justice and Democracy Under Pressure

The Trump administration imposed sweeping sanctions on the International Criminal Court (ICC) on October 9, hours after the Norwegian Nobel Committee awarded its Peace Prize to Navi Pillay, a South African jurist and former ICC judge [16765]. The sanctions targeted judges involved in investigations of American citizens or allies; the court had issued arrest warrants for Netanyahu and former Defense Minister Yoav Gallant over crimes in Gaza [16765].

In Turkey, police raided the Istanbul headquarters of opposition broadcaster Halk TV, halting its live broadcast and appointing a government trustee to run the network [16765]. In India, authorities detained more than 2,000 protesters and arrested the founder of a Gen-Z movement demanding the resignation of the election chief over a voter-roll revision that removed approximately 130 million names [16765].

The strain reached ordinary households in wealthy nations too. In France, protests over the rising cost of living swept the country, with students, trade unions, farmers and the Yellow Vests joining forces; police detained more than 2,000 people [16765]. In Kenya, Amnesty International accused authorities of using authoritarian tactics against protesters demanding economic relief [16765].

Taken together, the year's developments painted a picture of a global order that prioritized financial accumulation and profit over human welfare. The debt crisis forced governments to choose between servicing creditors and meeting citizens' needs. The energy crisis enriched fuel traders while leaving ordinary motorists struggling to afford petrol. The AI boom concentrated wealth in a few hands while workers faced displacement and new security risks. And the humanitarian crises from Gaza to Sudan to Somalia showed how conflict and restricted access—not simply bad weather—decided who ate and who did not [16744]. As bond markets wobbled, oil prices surged and the AI bubble threatened to burst, the fundamental question remained: who would bear the cost of these converging crises, and who would benefit from any recovery?

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