The Baltic “NATO lake” and the escalation trap: how hybrid war is nearing the threshold of open conflict

When Sweden and Finland applied for NATO membership in May 2022, advocates of enlargement said the Baltic would become a "NATO lake". Four years later, the phrase describes the geography but not the security. The Baltic Sea is surrounded by allies, yet it is also the most active zone of hybrid conflict between Russia and the West.

Chronicle of a year

The list of incidents in 2026 is long and varied. According to a chronology of drone incursions into the Baltic states and Finland, on March 25 a drone struck the chimney of the Auvere power plant in Estonia, with no injuries. At the same time, Ukrainian drones were targeting the Russian ports of Ust-Luga and Primorsk, and some drones, probably because of Russian electronic jamming, veered off course over Lithuania, Latvia, Estonia and Finland. Near Kouvola in Finland, a drone with an unexploded warhead was found.

In May the situation escalated. On May 7 a drone exploded at an oil depot in Rēzekne, Latvia; Defence Minister Andris Sprūds resigned, and the government later fell. On May 19 a Romanian F-16 on NATO's Baltic air policing mission shot down a drone over Estonia, the first such case. A day later Vilnius airport suspended flights, and members of the Lithuanian Seimas were taken to shelters.

The summer brought new shoot-downs: a French Rafale over Latvia in June, an Italian Eurofighter in August. In September a Russian Geoscan 701 drone was found near Porvoo in Finland, and on September 14 and 15 an Italian fighter shot down a Russian Gerbera drone over Lithuania, which President Gitanas Nausėda later confirmed had been intended for Ukraine. On the same day, September 14, a Russian frigate fired flares at a Danish military helicopter off the Danish coast.

The response dilemma

An analysis by Bethany Loveland for Common Defense on November 3 describes the essence of the problem: how to respond to Russian hybrid activity without further raising tensions. The Dutch military intelligence service warned earlier this year of a "real risk of unintended and therefore hard-to-control escalation". In September the Danish Defence Intelligence Service assessed that the hybrid war is escalating.

The commander of the Danish Army, Major General Peter Boysen, said in mid-October that the issue is "very difficult, because you don't want to escalate". In his view, Denmark must make it clear that such behaviour is unacceptable, but also look for a way to reduce tensions, and not allow repeated aggression to redefine what is considered normal in the Baltic.

Finnish Lieutenant General Kari Nisula, deputy chief of staff for operations, points to an additional factor: Russia's wartime posture and fear of long-range Ukrainian strikes make escalation harder to control, because Russian forces fear that their ships could be hit. In other words, a nervous side with its finger on the trigger is more dangerous than an aggressive one.

Intelligence warnings

According to Radio Free Europe, on August 6 the Wall Street Journal, citing US intelligence, reported that Russia could test NATO with a limited incursion as early as this autumn. On August 25 CIA Director John Ratcliffe travelled unannounced to Moscow and, according to sources, warned the Kremlin not to escalate against Estonia, Latvia and Lithuania. Baltic diplomats say that during the summer they had intelligence on Russian false-flag operations, but no signs of an imminent conventional attack.

Five European commissioners from the Baltic states, Poland and Finland, including EU High Representative Kaja Kallas and Defence Commissioner Andrius Kubilius, sent a letter to Commission President Ursula von der Leyen on July 30. In it they describe a "deteriorating security environment" and "increasingly frequent airspace violations and drone incursions", along with a request for about $115 billion to strengthen the economy and investment in frontline states.

The allied response

All three Baltic states have reached or will soon reach NATO's target of 5 percent of GDP for defence. Germany is deploying the 45th Armoured Brigade north of the Suwałki Corridor. In January 2025 NATO launched Operation Baltic Sentry, and Allied Command Transformation set up Task Force X-Baltic to accelerate the introduction of unmanned systems and artificial intelligence into the protection of undersea infrastructure. This summer Sweden authorised its armed forces to help Finland with territorial surveillance, including placing air assets under Finnish command.

But key projects are behind schedule. The "drone wall", a proposed European system of sensors and interceptors, faces unresolved questions of financing, technology and law, including who pays and whether the system should be fully automated. The Rail Baltica railway has abandoned its original goal of opening in 2026, and even the new deadline, 2030, has been called into question.

Why the Baltic matters to everyone

The Baltic is today the place where the credibility of Article 5 is being tested. Russia does not need to attack to achieve its goal: it is enough for every incident to remain below the threshold at which the alliance would have to respond collectively, and for every such episode to shift the boundary of the acceptable. This is exactly what General Boysen warns about. The danger lies not only in Russian intent but also in accident: a downed drone that falls in the wrong place, a helicopter hit by a flare, a warship that misreads a manoeuvre. In such an environment, a war can begin without anyone having decided to wage it.

Some drone incidents are still under investigation, and states often disagree in their assessments of the aircraft's origin.