As Steve Witkoff and Jared Kushner try to negotiate an end to the war in Ukraine, they are chasing a second prize: trillions of dollars in investment deals the Kremlin has dangled in front of President Donald Trump and his team. Trump’s envoys hope those deals could be a win-win for Washington and Moscow.

But current and former American officials, European officials and Russia analysts said Trump and his team have vastly overestimated the business opportunities for American companies in Russia. The Russian economy is uninvestable, they said, and will be for some time.

The megaprojects the Trump team favors are ambitious and capital intensive. Broad benefits for American companies and the American economy are unlikely. The more plausible winners, the officials and analysts said, are people in Trump’s circle who might be positioned to secure lucrative deals.

“There are influential voices in President Trump’s orbit who have an excessively rosy or optimistic assessment of the potential upside for U.S. companies in the Russian economy,” said Ludovic Hood, a veteran diplomat who was chief of staff to Trump’s former special presidential envoy for Ukraine, Keith Kellogg, and worked on the diplomatic efforts.

The lure of investment deals is clouding the Trump administration’s view on how to help negotiate an end to the war in Ukraine, said Hood, who is now at the Hudson Institute.

“Some voices are so wedded to this naively rosy assessment of commercial upside that it has had a detrimental impact on President Trump’s quest to preside over ending the war in Ukraine,” Hood said. Others briefed on some of the diplomatic discussions agreed.

“They are overestimating the possibilities and, frankly, the viability of some of what they’re looking at,” said a Senate Democratic aide, who was granted anonymity to describe the closed-door briefings.

“When it comes to Russia’s most sensitive and most lucrative industries,” the aide said, “they are never going to be willing to work with our folks on that in a sustainable manner.”“We do tend to think that the negotiation team is rather naive when they talk about these prospects,” the aide said.

Asked for comment, a White House official said Trump is seeking an end to the war between Russia and Ukraine “so the senseless killing ends.”The official was not authorized to speak publicly.

“The President and his team remain committed to continuing to play a constructive role in ending the war between Russia and Ukraine, and he remains optimistic that we’ll ultimately get a peace deal done,” the official said.

The Trump administration’s fixation on the business potential has been back in the spotlight as Witkoff presses to resume months of stalled diplomacy.

After Witkoff met with Russian President Vladimir Putin in St. Petersburg on Oct. 21, Kirill Dmitriev — Witkoff’s main Russian interlocutor who is close to Putin and runs Russia’s sovereign wealth fund — said Washington and Moscow are discussing a range of joint projects, such as data centers powered by small scale nuclear power plants. Dmitriev said a recent deal for Russia to sell diesel fuel to American and global markets has broken the ice for other business links.

The Trump team has said publicly that business deals between Moscow and Washington would come after the fighting ends, but it has sought to work them out with Russia in diplomatic talks to try to incentivize Putin to compromise.

But they have been a significant part of the bilateral talks. In a sign of their importance to the White House, Witkoff was photographed holding a note card in the St. Petersburg meeting noting three agenda items: thanking Putin, pushing for trilateral talks and the business deals.

Since Trump began talking to Putin early in his term, the business possibilities have always been a key appeal for him.

“I am in serious discussions with President Vladimir Putin of Russia concerning the ending of the War, and also major Economic Development transactions which will take place between the United States and Russia,” he said on Truth Social in February 2025.

Trump administration officials are falling for a tactic that Putin has employed for years, two European officials told MS NOW.

The officials, who spoke on condition of anonymity, citing the sensitivity of relations with Russia, said that Putin and his allies have repeatedly exaggerated the profits that can be generated in Russia by U.S. and European corporations.

Extracting oil and rare earth minerals from remote corners of Russia is costly and time consuming.

Russian infrastructure is antiquated, and the country’s economy remains small compared to the U.S. and Europe. “Look at the statistics,” said the second European official about the size of Russia’s economy.

“There’s not much there.”Washington would be betting on a market in decline.

Russia’s growth slowed to about 1% in 2025, its middle class is shrinking and the Kremlin plans to spend roughly 35% of its 2027 budget on the military.

Even before the full-scale invasion, the market was modest: some 1,500 foreign companies tracked by the Kyiv School of Economics earned a combined $18 billion in profit in 2021, on revenue of $318 billion. Russia’s current annual economic output is $2.5 trillion, smaller than France’s.

The European officials also warned that Putin has seized control of past joint ventures that were launched by foreign companies and nationalized them. They predicted that would happen again.

“This won’t last long,” the European official said. “ In the end, Russia always confiscates.”The megaprojects that are of most interest to the Trump team are fraught with difficulty, analysts said. Most surveys of Russia’s Arctic oil and mineral reserves date to Soviet times, so it is hard to know how much can be extracted at a profit.

Rare earths located in Russia’s far north are harder still to get to. China dominates the world’s rare-earth mining and refining and has refused to share its know-how with Moscow, wary of creating a rival.

Beyond the challenge of realizing any of the potential opportunities, Russia is the most sanctioned economy in the world.

Undoing the tens of thousands of restrictions imposed by the U.S. and Europe since 2014 and especially after 2022 will be extremely complicated. While Trump can lift some on his own, he would need to consult Congress for others, and Europe has many of its own sanctions that would have to be lifted.

Western companies have had mixed fortunes in Russia, and since 2022, Moscow has imposed rules that make doing business there, or leaving, even more punishing for Western firms.

“Doing business with Russia right now carries an enormous level of political, legal, operational, and reputational risk, and even doing this with the president as as your of lead negotiator, doesn’t necessarily reduce any of those risks,” said Charles Hecker, an associate fellow at the Royal United Services Institute in London and the author of a 2024 history of Western business in Russia.