New Delhi, Dec. 19 -- As US guarantees evaporate and legal warnings pile up, EU leaders consider a high-risk seizure of Russian sovereign assets that could shatter financial norms and trigger retaliation from Moscow.

Brussels - European Union leaders arrived at a decisive summit this week facing one of the most consequential financial and geopolitical choices in the bloc's history: whether to proceed with plans that would effectively weaponize Russian sovereign assets to fund Ukraine's war effort, despite deep internal divisions, mounting legal risks, and warnings of far-reaching retaliation from Moscow.

The proposal centers on the use of profits, and potentially the principal, derived from frozen Russian central bank assets held largel...