News of a framework deal came on Thursday as Trump backed off tariff threats and ruled out taking Greenland by force, bringing a degree of respite in what was brewing to be the biggest rupture in transatlantic ties in decades.
But the details of any agreement were unclear and Denmark insisted its sovereignty over the island was not up for discussion. EU foreign policy chief Kaja Kallas said relations between the bloc and the US had "taken a big blow" in the past week, as EU leaders met for an emergency summit.
Greenland's Prime Minister Jens-Frederik Nielsen welcomed Trump's latest comments but said he was still in the dark on many aspects.
"I don't know what there is in the agreement, or the deal, about my country," he told reporters in the capital Nuuk.
"We are ready to discuss a lot of things and we are ready to negotiate a better partnership and so on. But sovereignty is a red line," he added, when asked about reports that Trump was seeking control of areas around US military bases in Greenland as part of a wider deal.
"We cannot cross the red lines. We have to respect our territorial integrity. We have to respect international law and sovereignty."
A source familiar with the matter, who spoke on condition of anonymity, told Reuters that NATO Secretary General Mark Rutte and Trump agreed in a meeting to hold further talks between the United States, Denmark and Greenland on updating a 1951 agreement that governs US military access and presence on the island.
The framework they discussed also calls for prohibiting Chinese and Russian investments in Greenland, the source said.
Trump's U-turn had triggered a rebound in European markets and a return toward record highs for Wall Street's main indexes, but also raised questions about how much damage had already been done to transatlantic ties and business confidence.
Trump's ambition to wrest sovereignty over Greenland from fellow NATO member Denmark has threatened to blow apart the alliance that has underpinned Western security since the end of World War II, and reignite a trade war with Europe.
Danish Prime Minister Mette Frederiksen said no negotiations had been held with NATO regarding the sovereignty of Greenland, a semi-autonomous territory of Denmark.
"It is still a difficult and serious situation, but progress has also been made in the sense that we have now got things where they need to be. Namely that we can discuss how we promote common security in the Arctic region," she said.
The 1951 agreement between Washington and Copenhagen established the US right to construct military bases in Greenland and move around freely in Greenlandic territory. This is still the case as long as Denmark and Greenland are informed of its actions. Washington has a base at Pituffik in northern Greenland.
"It is important to clarify that the US had 17 bases during the Cold War and much greater activity. So that is already possible now under the current agreement," said Marc Jacobsen, a professor at the Royal Danish Defence College.
"I think there will be concrete discussions about Golden Dome, and I think there will be concrete discussions about Russia and China not being welcome in Greenland."
However, diplomats told Reuters EU leaders will rethink relations with the US as the Greenland episode has badly shaken confidence in the transatlantic relationship. Governments remain wary of another change of mind by Trump, who is increasingly seen as a bully Europe will have to stand up to, they said.
Residents in the Greenland capital, Nuuk, are also wary.
"It's all very confusing," said pensioner Jesper Muller.
"One hour we are, well, almost at war. Next hour everything is fine and beautiful, and I think it's very hard to imagine that you can build anything on it."
