AI spies, near-miss dogfights and a volatile summer

Hey team,

Plenty of things to discuss in the headlines this week, but the real events are happening in places most people aren’t looking. Peace talks are moving quietly, cyber hits are landing, and military manoeuvres are setting the pace.

Here’s what matters now and what to watch in the coming days.

Enjoy.

ALCON.

BLUF

Ukraine and Gaza diplomacy sit on fragile ground as Russia sustains pressure and China pushes the limits with Japan in the Western Pacific. At the same time, Chinese-linked AI-enabled espionage, supply-chain ransomware, a softening trade outlook, and a volatile La Niña summer with storms, heat and fire weather are likely to drive most near-term strategic risk.

Diplomacy

Ukraine and its partners met in London with national security advisers from around 80 states to promote an updated version of Kyiv’s 10-point peace plan, seeking broader backing from the Global South. Russia was not invited, and progress remains bounded by Moscow’s insistence on territorial gains and Kyiv’s refusal to accept any such concessions. Oil market reporting notes that investors are already gaming out how any future agreement could alter Russian export volumes, which shows how economic actors are shadowing the diplomatic track even as talks remain tentative.

Russia-Ukraine war updates: E3 talks in London ‘productive’, says Zelenskyy

In Gaza, the Qatari prime minister used the Doha Forum to warn that the ceasefire and phased hostage-release framework are at a delicate point, citing Israeli actions on the ground and disputes over the handover of bodies as key frictions. Mediators continue to float ideas for a post-war stabilisation force and interim governance, but neither Israel nor Hamas has given clear public backing to a structured political roadmap.

【每日必看】差點就"發射"! 陸殲-15兩度雷達照射日方抗議 20251207

In East Asia, Beijing and Tokyo are trading sharp diplomatic messages after Japan protested that Chinese J-15 fighters from the carrier Liaoning repeatedly used fire-control radar on Japanese F-15s near Okinawa during intense carrier flight operations. Chinese officials deny unsafe behaviour and accuse Japan of disrupting lawful training, while later talks with Germany’s foreign minister were used by Beijing to criticise Japanese comments on Taiwan and security

Short-term outlook

Over the next month, Ukraine peace diplomacy is likely to stay in a consultation and consensus-building phase among partner states, with little chance of direct talks with Russia unless there is an unexpected shift on the battlefield or in Moscow. Gaza mediation will likely remain under heavy strain, and there is a real possibility of partial breakdowns in the ceasefire framework even if mediators keep the basic channel alive. In East Asia, further diplomatic protests between China and Japan are highly likely, but deliberate escalation to formal sanctions or defence treaty crises appears unlikely in the coming month.

Information (Cyber & Influence)

US and Canadian agencies jointly disclosed that a Chinese-linked actor deployed “Brickstorm” malware to maintain long-term access in unnamed government and IT networks, with officials warning that the access could support disruption or sabotage of critical infrastructure if activated.The advisory emphasises living-off-the-land techniques and long dwell times, consistent with earlier reporting on Chinese interest in pre-positioning within Western networks.

Separately, Anthropic released details of the GTG-1002 campaign, the first reported AI-orchestrated cyber espionage operation. A Chinese state-sponsored group misused Claude Code to automate 80–90 percent of technical intrusion activity across stages such as reconnaissance, exploitation, lateral movement and data exfiltration, targeting around 30 high-value organisations across technology, finance, chemicals and government.The incident has prompted calls from US lawmakers for further testimony from Anthropic leadership on AI misuse.

AI-Powered Cyber Espionage: Inside the GTG-1002 Campaign

In the financial sector, Marquis Software Solutions disclosed that an August 2025 ransomware attack (likely linked to the Akira group) exploited a SonicWall firewall flaw, exfiltrating files that contained personal and financial data for more than 400,000 customers of at least 74 US banks and credit unions.Regulators and security firms highlight the case as another example of supply-chain risk from third-party marketing and compliance vendors.

Short-term outlook

AI-driven espionage of the GTG-1002 type is highly likely to inspire copycat experiments by both state and criminal groups over the next month, especially against targets that still rely on manual monitoring and traditional signatures. Continued investigation of Brickstorm access is likely to reveal additional affected entities, and further joint advisories and emergency patch campaigns across North American and allied infrastructure are very likely. Supply-chain ransomware against mid-tier vendors such as Marquis will remain a high-probability threat, and another breach at a service provider with multi-client financial or education data in the next month is a realistic possibility.

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Military

On the ground in Ukraine, Russian forces continue artillery, missile and drone strikes that Kyiv describes as some of the heaviest in weeks, including attacks that reportedly killed at least 19 people and damaged energy and residential sites. Front lines remain largely static, but casualty figures on both sides continue to rise as Russia presses along the eastern axis and Ukraine expends scarce resources to hold urban and trench positions.

Chinese Liaoning Carrier Strike Group Now Operating in the Philippine Sea - USNI News

In the Western Pacific, the Liaoning carrier group has been conducting sustained air operations near Japan’s Ryukyu island chain, with Japanese reporting of around 100 take-offs and landings over recent days.Japanese authorities state that J-15 fighters launched from the carrier intermittently locked fire-control radar on Japan Air Self-Defence Force F-15s in international airspace, triggering formal protests and public warnings about the risk posed by such behaviour in crowded skies.

Maritime security in the Red Sea remains a latent flashpoint, with major shipping lines still cautious about fully returning to Suez routes given persistent concerns about missile and drone attacks and the need for naval escorts, despite some improvement compared with earlier peaks in the crisis.

Short-term outlook

Russian forces are highly likely to continue missile, drone and artillery raids against Ukrainian cities and infrastructure over the next month, with particular risk to power and logistics hubs as winter advances. Front-line movement on land remains possible but large territorial swings in the next month appear unlikely given current attrition and supply patterns. In the Western Pacific, further close encounters between Chinese and Japanese aircraft are likely, and there is a non-trivial possibility of another radar-lock or near-miss incident, although both sides still appear keen to avoid an uncontrolled military clash.

Economic

China’s customs data show its trade surplus has exceeded USD 1 trillion in the first 11 months of 2025, driven by strong exports to Europe, Australia and Southeast Asia as firms route around higher US tariffs, while shipments to the United States fell by roughly one-third year-on-year in November. Imports lagged expectations, which points to continued weak domestic demand even as factories maintain output for overseas markets.

Oil prices slipped by around 2 percent after Iraq restored production at the West Qurna-2 oilfield, which accounts for roughly 0.5 percent of world supply, calming some earlier fears of a prolonged outage. Markets remain sensitive to any sign that Ukraine peace efforts might alter Russian export volumes, while G7 and EU discussions on tightening maritime services limits for Russian oil continue in the background.

Global trade growth projections point to a slowdown next year as new and existing tariffs bite and logistics remain disrupted. One major analysis suggests world trade growth could fall from about 4.2 percent in 2025 to roughly 2.3 percent in 2026 as higher US-China tariffs and shipping diversions through the Cape of Good Hope feed into costs and delivery times.

Short-term outlook

Over the coming month, oil prices are likely to trade in a relatively narrow range, with Iraqi production recovery and softer demand offset by ongoing geopolitical risk premia linked to Ukraine and the Middle East. China is likely to keep leaning on export-led growth and targeted industry support rather than large-scale consumer stimulus in the near term, so its import weakness is likely to persist. Shipping costs on routes affected by Red Sea risk are very likely to stay clearly above pre-attack levels, raising the chance that more firms adjust inventories, reroute cargoes, or pass costs into prices in early 2026.

Weather Events

Moderate La Niña conditions remain present in the tropical Pacific, although NIWA expects a rapid weakening towards ENSO-neutral by late summer. For New Zealand, the seasonal outlook for December to February points to unsettled weather in early December followed by increasingly frequent high-pressure systems, especially over the North Island, raising concern about regional dryness from mid-December into January. Marine heatwaves around much of the country increase the chance of heavy rain events from tropical or sub-tropical systems later in summer, particularly for northern regions, and there is a normal to elevated risk of ex-tropical cyclone remnants affecting New Zealand between now and April.

In the North Atlantic, Storm Bram is forecast to bring very strong winds, heavy rain and coastal flooding to Ireland, Scotland and parts of the wider UK, with national agencies issuing “danger to life” warnings for wind gusts, high waves and localised flooding. European forecasters warn that saturated ground from recent rain could increase treefall and infrastructure disruption, particularly to power and transport.

In Australia, intense heat and tinder-dry fuels have already produced significant bushfires in New South Wales and Queensland, and authorities warn that conditions are set for an active fire season under hotter and drier patterns. Globally, climate monitoring shows the planet has now recorded 12 consecutive months above the 1.5°C warming threshold, reinforcing the backdrop for more frequent and intense extreme weather.

Short-term outlook

Over the next month, repeated Atlantic storm systems are likely to bring further periods of high wind and heavy rain to parts of Ireland, the UK and western Europe, with a continuing risk of localised flooding, power outages and transport disruption. In Australasia, it is highly likely that heat and fire weather will flare again in eastern Australia, while New Zealand faces a high likelihood of increasing dryness and heightened rural fire danger in eastern and northern areas through mid-January, with a realistic possibility of local water restrictions if high pressure persists. For the broader South Pacific, at least one tropical system or ex-tropical cyclone affecting island states or brushing northern New Zealand in the next month is a reasonable possibility, even though the peak risk window sits later in the season.