Ukraine has agreed to a US-proposed deal for the rights to its mineral wealth after Donald Trump backed down on his most extreme demands.

Volodymyr Zelensky, Ukraine’s president, is set to sign the deal in Washington DC as early as this Friday, bringing to an end a heated dispute with the US president over the terms of the pact.

The draft deal does not commit to Ukraine using the profits from its natural resources to repay the United States up to $500bn (£400bn), a key demand of Mr Trump, who has complained that the US “got nothing back” from its support of the Ukrainian war effort.

Instead, Kyiv will contribute 50 per cent of the funds raised by future developments of minerals and energy reserves to a joint fund that would be used to invest in projects in Ukraine. 

The size of the US stake in the fund is not included in the deal but the Financial Times has reported that terms of “joint ownership” deals will be thrashed out in follow-up agreements.

The US will not gain the rights to any of Ukraine’s existing oil or gas production.

Speaking to reporters in the Oval Office on Tuesday, Mr Trump did not confirm that an agreement had been finalised but said Kyiv got $350 billion for the deal, the sum the president claims the US has already given to Kyiv, and “the right to fight on”.

“They’re very brave,” he said, but “without the United States and its money and its military equipment, this war would have been over in a very short period of time.”