FP’s Situation Report: Islamic State victory in Libya is no sure thing; What can get done at Obama’s terror summit?; Syrian rebels call in U.S. airstrikes; and much more from around the world.

By David Francis with Sabine Muscat

An Islamic State victory in Libya is far from certain. The terror group moved across Iraq and Syria with ease. But after drawing heat for beheading Egyptians, the path to take Libya is much more difficult. FP’s Kate Brannen and Keith Johnson: “The Islamic State’s success in Iraq and Syria was fueled in part by its control of some of the region’s richest oil fields, but the group will be hard-pressed to turn Libya’s oil reserves into a steady source of financing.”

Results uncertain at Obama’s terror summit. Officials from some 60 nations are set to arrive in Washington, D.C. this week for President Barack Obama’s long-postponed three-day summit on combating violent extremism. Ahead of the meeting, the key players in Obama’s administration can’t get on the same page. FP’s John Hudson: “If the debate over how much to focus on Islam were the only hurdle for this White House, the summit would be a manageable affair. But the internal politics of the summit have been as heated as the external politics. And it hasn’t helped that at least some State Department officials only learned about their involvement in the summit on Jan. 11.”

Obama empowers Syrian rebels with airstrikes. One key to the White House strategy against the Islamic State is to train moderate Syrian rebels to fight the group. DoD is also giving them access to a key component of the American arsenal. The Wall Street Journal’s Julian E. Barnes and Adam Entous: “The U.S. has decided to provide pickup trucks equipped with machine guns and radios for calling in U.S. airstrikes to some moderate Syrian rebels, defense officials said. But the scope of any bombing hasn’t been worked out—a reflection of the complexities of the battlefield in Syria.”

More on terrorism and the Islamic State below.

PRESS PACK: The cease-fire in Ukraine is falling apart.

The Washington Post’s Karoun Demirjian and Daniela Deane: “Hundreds of Ukrainian government forces began a chaotic retreat from a surrounded town in the east of the country Wednesday, a major defeat with uncertain consequences for the future of the grinding 10-month-old conflict.”

The New York Times’ Andrew E. Kramer: “The Ukrainian government maintains that the town was not surrounded before the cease-fire took effect, and that European monitors of the truce should insist that the separatist forces halt their offensive and open a corridor to evacuate the wounded.”

The Wall Street Journal’s Laurence Norman and Nick Shchetko: “The European Union looks set to scale back its sanctions against former Ukrainian president Viktor Yanukovych’s inner circle, according to several EU diplomats, an admission there was too little evidence to back up corruption allegations against some of the 22 people listed.”

The Guardian’s Julian Borger and Eliot Higgins on shells landing in Ukraine: “[A] group of British investigative journalists using digital detection techniques, satellite imagery and social media has provided near conclusive proof that the shelling came from across the border in Russia.”

Welcome to Wednesday’s edition of the Situation Report, where State Department spokesperson Marie Harf’s comments weren’t too nuanced for us.  

Connect with me at david.francis@foreignpolicy.com and @davidcfrancis and spread the word about SitRep — your destination for global security news and Washington whatnot. Like what you see? Tell a friend. Tell your colleagues. Don’t like what you see? Tell me. Or holler with tips, reports, or anything else the world needs to know, and I’ll try to include it.

WHO’S WHERE WHEN TODAY:

9:00 a.m. The Brookings Institution hosts a panel on “Yemen and Libya: The Middle East’s Other Civil Wars.” 9:00 a.m. The American Enterprise Institute hosts a panel on “The Struggle For Iraq’s Future: Is It A Lost Cause?” 3:00 p.m. Secretary of State John Kerry speaks at the White House Summit on Countering Violent Extremism. 4:15 p.m. President Obama addresses the same summit.

WHAT’S MOVING MARKETS

Bloomberg’s Jonathan Stearns and Patrick Donahue: “Greece may request an extension of its loan agreement for six months, according to a person familiar with the matter, a step that could ease a standoff with creditors over the country’s future financing.”

The New York Times’ Liz Alderman on the Greek government’s pending bureaucracy battle: “Just as harmful as austerity cutbacks have been the structural problems inhibiting economic efficiency, many of which have barely budged, despite creditors’ demands.”

The Wall Street Journal’s Lingling Wei and Brian Spegele: “China’s leadership is exploring ways to consolidate the country’s oil industry, creating new national champions able to take on the likes of Exxon MobilCorp. and operate more efficiently as prices slide.”

LIBYA: Alliances fuel Islamic State’s rise in Libya as Egypt calls for a U.N.-backed intervention. Meanwhile, the Islamist faction in Libya, Libya Dawn, launches airstrikes.

The Wall Street Journal’s Benoît Faucon and Matt Bradley: “It is yet another example of how the radical movement has been able to capitalize on chaos and a brand name synonymous with militant strength to incorporate like-minded Islamist insurgencies throughout the region.”

AFP: “Egypt’s top diplomat was in New York to secure backing for military intervention from U.N. Security Council members and to demand ‘full support’ against the jihadists, a foreign ministry spokesman said.”

The New York Times’ David D. Kirkpatrick: “The extent of the damage was unclear. But the attack on Tuesday raised the possibility of an air war between the rival Libyan factions and diminished hopes for United Nations-sponsored talks about ending the conflict.”

ISLAMIC STATE: Iraqi cleric Muqtada al-Sadr freezes Shiite militias as Syria’s U.N. envoy Staffan de Mistura claims he’s persuaded Bashar al-Assad to agree to a six-week truce in Aleppo.

The Washington Post’s Loveday Morris and Mustafa Salim: “Sadr claimed to have taken the decision as a ‘show of goodwill’ following reports of atrocities by Shiite militia groups, many of which are not under his control. Analysts said, however, that other strategic motivations may have prompted the move.”

Reuters’s Michelle Nichols: “Mistura told the council he would travel to Syria to discuss it further and gave no indication of when such a suspension might start, said diplomats attending the closed door meeting, who spoke on condition of anonymity.”

The BBC reports the United States is set to send 400 more troops to train moderate Syrian rebels.

COUNTER-EXTREMISM SUMMIT: More details on the controversy surrounding the event.

Yahoo News’s Olivier Knox: “Some have even taken issue with the conference name, arguing that the only kind of extremism that threatens America grows out of radical strains of Islam.”

DENMARK: Europe’s terrorism response evolves as new details about the alleged gunman emerge. Meanwhile, French authorities weigh the value of surveillance.

FP’s Elias Groll on Europe’s new terrorism tactics: “In neighboring Sweden, police were out in force Tuesday, guarding possible terrorist targets with automatic weapons. Swedish police also carried out an operation that netted four men described as financiers for the Islamic State.”

The Wall Street Journal’s Anna Molin on early warnings about Omar Abdel Hamid El-Hussein: “The Danish intelligence service said it had been alerted last year that the gunman believed to be responsible for deadly attacks on a synagogue and free-speech event in Copenhagen was at risk of being radicalized.”

The New York Times’ Katrin Bennhold and Eric Schmitt: “Largely caught off guard by the proliferation of potential threats, they now confront wrenching trade-offs in deciding how and whether to monitor hundreds or thousands of their citizens who are traveling in and out of conflict zones, otherwise making contact with radicals or being inspired by assaults like the one on Charlie Hebdo.”

AFGHANISTAN: The Taliban exploit Afghan police with coordinated strikes.

The New York Times’ Mujib Mashal: “Four Taliban suicide bombers disguised in Afghan police uniforms stormed a heavily fortified provincial police headquarters in central Afghanistan on Tuesday, killing at least 20 officers and wounding eight others.”

The New York Times’ Azam Ahmed reports last year was the deadliest for civilians in Afghanistan.

IRAN: Iranians want a nuclear deal.

NPR’s Steve Inskeep: “An economist seemed almost desperate for Iran to seize the opportunities that would come with a nuclear deal that lifts economic sanctions. An investor spoke of real estate developments for which he had already laid the groundwork; he was waiting for a nuclear deal before proceeding.”

AFRICA AND THE MIDDLE EAST: U.S. and Israeli relations suffer as Americans support Israeli Prime Minister Benjamin Netanyahu’s planned speech to Congress. In Nigeria, Boko Haram strikes again.

The New York Times’ David E. Sanger: “With the Obama administration racing to negotiate the outlines of a nuclear deal with Iran by the end of March, aides to Prime Minister Benjamin Netanyahu of Israel have charged in recent days that they are being deliberately left in the dark about the details of the talks.”

Bloomberg’s Josh Rogin reports on a new poll that shows Americans want Netanyahu to speak.

The Wall Street Journal’s Gbenga Akingbule: “Boko Haram militants attacked two towns in northeastern Nigeria, killing at least 37 people, witnesses said Tuesday, as government forces continued trying to secure the country ahead of a once-postponed national election next month.”

DRONES: U.S. approves the limited sale of drones to allies.

The Washington Post’s Missy Ryan: “The Obama administration will permit the widespread export of armed drones for the first time, a step toward providing allied nations with weapons that have become a cornerstone of U.S. counterterrorism strategy but whose remotely controlled power to kill is intensely controversial.”

CUBA: The State Department announces the next round of U.S.-Cuba talks.

The Washington Post’s Felicia Schwartz: “The talks, mostly centered on logistical issues to facilitate reopening embassies in Washington and Havana, will take place at the State Department on Feb. 27. Assistant Secretary of State for Western Hemisphere Affairs Roberta Jacobson is leading the U.S. delegation in the talks and her Cuban counterpart Josefina Vidal is leading the Cuban negotiators.”

AND FINALLY, want to know how much Netanyahu and his wife spent on takeout in 2012? Some $24,000, according to a report released by the Israeli state comptroller.