The European Union, United States and their allies have agreed to cut off a number of Russian banks from the main international payment system, SWIFT.
A German government spokesman said: “This is intended to cut off these institutions from international financial flows, which will massively restrict their global operations.”
Russia is heavily reliant on the Swift system for its oil and gas exports.
However, the move could also harm Western businesses doing business with Russia.
The Society for Worldwide Interbank Financial Telecommunication (SWIFT), is a secure messaging system that makes fast, cross-border payments possible, enabling international trade.
The banks set to be affected are “all those already sanctioned by the international community, as well as other institutions, if necessary”, the German spokesman said.
Ursula von der Leyen, president of the European Commission, said the allies would stop Russia from “using its war chest,” by paralysing the assets of its central bank. They also agreed to freezing its transactions and prevent the central bank from liquidating its assets.
She added there would be a crackdown on so-called “golden passports” that “let wealthy Russians connected to the Russian government become citizens of our countries and gain access to our financial systems”.
UK PM Boris Johnson said Britain had taken “decisive action”, tweeting: “We will keep working together to ensure Putin pays the price for his aggression.”
The measures were agreed by the US, UK, Europe and Canada.
It is the latest round of sanctions to hit Russia since it launched an invasion of Ukraine this week.
Removing banks from Swift is deemed to be a severe curb because almost all banks use the system.
France has intercepted and impounded a Russian-flagged car cargo ship suspected of breaching sanctions imposed because of the invasion of Ukraine.
The Baltic Leader ship was heading from the north-western French city of Rouen to St Petersburg in Russia with a cargo of new cars.
It is being held at the Channel port of Boulogne.
According to the Russian state media, the vessel is owned by a subsidiary of a bank targeted in recent EU and US sanctions.
A regional French official said such a measure was rare, but called it a sign of firmness.
The U.S. says the ship was linked to the son of a former Russian spy chief, in one of the first visible displays of the West enforcing sanctions on Moscow over its Ukraine invasion.
The US Treasury Department has issued blocking sanctions against the vessel, saying it is owned by a subsidiary of Promsvyazbank, one of the Russian financial institutions hit by sanctions.
However, the bank has said it no longer owns the Baltic Leader. It told Reuters that the ship was sold to another firm before the sanctions were imposed.
French officials said they were checking whether the vessel was linked to Russian financial interests and that the crew were “being co-operative”.
The process could take up to 48 hours, they added.
The Russian embassy in Paris said it would send a note of protest to the French foreign ministry over the seizure.
One Ukraine’s national guardsman has been killed and about 100 injured in violent protests outside Ukraine’s parliament, the interior ministry said.
Clashes between nationalists and riot police erupted after members of parliament gave initial backing to reforms for more autonomy in the rebel-held east.
National guardsmen were pelted with fire crackers and petrol bombs as explosions were heard.
The reforms are part of a peace plan to end fighting in eastern Ukraine.
Protesters led by the populist Radical Party and the ultra-nationalist Svoboda (Freedom) party – who fear the loss of the east to Russian-backed separatists – gathered outside parliament on August 31.
After a rowdy debate, 265 members of parliament out of 450 backed the first reading of the decentralization bill, granting more powers to areas of Donetsk and Luhansk.
The Ukrainian Interior Minister, Arsen Avakov, said some 30 people have been detained, including a Svoboda member who confessed to throwing a grenade.
He bitterly criticized Svoboda leader Oleh Tyahnybok, writing on Facebook that several explosive devices had been thrown by people wearing Svoboda T-shirts.
A policeman’s leg was torn off below the knee in the blast, Interfax Ukraine reported, while journalists at the scene were also reported injured.
Almost 7,000 people have died since the conflict in eastern Ukraine broke out in March 2014, after Russia’s annexation of the Ukrainian peninsula of Crimea.
Pushing through greater autonomy for the rebel-held areas is a key part of the Minsk peace deal, originally signed in February.
During the summer, fighting between Ukrainian army forces and the rebels has escalated. But the two sides agreed last week to halt the violence on September 1, the day children in the region return to school.
Although the number of ceasefire violations appears to have fallen in recent days, OSCE monitors have warned that neither side was respecting the truce.
Under the draft constitutional changes going through parliament, there will be a special law covering local government in rebel-held areas.
However, parliament speaker Volodymyr Hroysman was adamant that would not mean special status for Donetsk and Luhansk, which rebel leaders have declared republics.
If President Petro Poroshenko is to succeed in pushing through the reforms, he will need the support of 300 members of parliament, seen as a tall order for the Ukrainian leader.
Petro Poroshenko is due to address the nation on the proposals and the violence outside parliament on August 31.
Secretary of State John Kerry flies to Russia to meet President Vladimir Putin during his first visit to the country since the beginning of Ukraine in early 2014.
Kremlin spokesman Dmitry Peskov called the visit a “positive step” and said the Russian president was prepared for “extensive” discussions at the meeting in Sochi.
Jonh Kerry will also meet his Russian counterpart Sergei Lavrov.
The West accuses Russia of arming rebels in eastern Ukraine and sending troops there – charges Moscow denies.
More than 6,000 people have been killed since fighting began in April 2014 between Ukrainian government forces and Russian-backed rebels in the eastern Donetsk and Luhansk regions.
The conflict followed Russia’s annexation of the Crimean peninsula in southern Ukraine.
State Department spokeswoman Marie Harf said John Kerry’s trip was “part of our ongoing effort to maintain direct lines of communication with senior Russian officials and to ensure US views are clearly conveyed”.
Dmitry Peskov praised John Kerry’s decision to travel to Russia, adding: “We are always open to showing a political will for a broader dialogue.
“Through dialogue, it is possible to look for paths to a certain normalization, to a closer co-ordination in decisions.”
Vladimir Putin’s spokesman said Russia was prepared to discuss international “hot spots” as well as bilateral relations, and that the issue of Western sanctions against Russia would not be raised by the Russian side.
Earlier, Russia’s Foreign Ministry issued a statement blaming the US for provoking the Ukraine crisis and attempting to “isolate Russia” while demanding its allies follow suit.
John Kerry’s visit comes two days after German Chancellor Angela Merkel attended a wreath-laying ceremony in Moscow to commemorate the Russians killed during World War Two.
At a joint news conference with Vladimir Putin, Angela Merkel said the annexation of Crimea had caused “a serious setback in our relations”.
Angela Merkel and other Western leaders boycotted a military parade in Red Square on May 9.
Anti-Maidan protesters rally in Moscow to condemn the “coup” in neighboring Ukraine, a year after the downfall of its pro-Russian President Viktor Yanukovych.
Russian state media heavily promoted the rally and march with the slogan “We won’t forget! We won’t forgive!”.
Ukraine’s protests ousted pro-Russian President Viktor Yanukovych in 2014.
Russia has since annexed Ukraine’s Crimea peninsula and is accused of backing rebels in eastern Ukraine.
The Ukrainian government, Western leaders and NATO say there is clear evidence that Russia is helping the rebels in eastern Ukraine with heavy weapons and soldiers. Independent experts echo that accusation. Moscow denies it, insisting that any Russians serving with the rebels are “volunteers”.
Shelling could be heard on Saturday morning in the city of Donetsk, the rebels’ main stronghold, further fraying the ceasefire which was meant to begin nearly one week ago in eastern Ukraine.
Nearly 5,700 people have died since the fighting erupted in April 2014 and some 1.5 million people have fled their homes, according to the UN.
The Moscow event is styled as an “anti-Maidan” march – a reference to Ukraine’s pro-EU protests that started on Kiev’s central Independence Square, widely known as the Maidan.
Groups of demonstrators gathered in central Moscow on Saturday under patriotic Russian banners.
One group of marchers in military fatigues could be seen with a placard which read “Maidan is an illness – we’re going to cure it!”
Another placard read “Maidan benefits the enemies of Russia!”
At least 10,000 people are expected to turn out with more than 100 public organizations mustering support, Russia’s NTV news channel reports.
The channel says it will air an interview with Viktor Yanukovych later in the day.
The anti-Yanukovych revolt was triggered by a sudden U-turn that ditched a wide-ranging pact with the EU in favor of closer ties with Russia.
Since Viktor Yanukovych fled Kiev, the new authorities in Ukraine have issued an arrest warrant for him over the “mass murder of peaceful citizens”.
Ukrainian President Petro Poroshenko accused Russia on February 20 of direct involvement in the sniper fire that killed dozens of protesters in Kiev on February 18-20 last year.
Petro Poroshenko was speaking just two days after his army retreated from the key town of Debaltseve, now in rebel hands.
Speaking at a commemorative gathering in Kiev, he said Russian presidential aide Vladislav Surkov had organized “groups of foreign snipers”. The president cited information he had received from Ukraine’s security services.
The Russian foreign ministry hit back at the claim, calling it “nonsense”.
The rebels took the strategic transport hub, despite the ceasefire signed on February 12, arguing that the truce did not apply to the flash-point town.
An intense rebel bombardment forced some 2,500 government troops to retreat from Debaltseve, and dozens of others surrendered.
Russian President Vladimir Putin issued a tough statement on February 20 warning that he would not allow any foreign state to gain the military advantage over Russia.
“No-one should have the illusion that they can gain military superiority over Russia, put any kind of pressure on it,” he said.
Russian President Vladimir Putin, Ukrainian President Petro Poroshenko, German Chancellor Angela Merkel and French president Francois Hollande have reached an agreement aimed at ending the fighting in Ukraine following marathon talks in Minsk, Belarus.
The leaders announced that a ceasefire would begin on February 15.
The deal also includes weapon withdrawals and prisoner exchanges, but key issues remain to be settled.
The pro-Russian rebels in eastern Ukraine have signed the agreement. Thousands of people have died in almost a year of fighting in the region.
The deal is very similar to a ceasefire agreed in September 2014, which unraveled very quickly.
Key unresolved issues include the status of Debaltseve, a government-held town surrounded by rebels, where fighting is still going on.
Further talks will also be held on self-rule in parts of Donetsk and Luhansk separatist regions.
President Francois Hollande said he and Chancellor Angela Merkel would ask their European Union partners to support the deal at a summit in Brussels on Thursday.
Angela Merkel said there was now a “glimmer of hope” but big hurdles remained, while Francois Hollande said “the coming hours will be decisive”.
EU foreign policy chief Federica Mogherini said European leaders in Brussels would be discussing ways to “help and sustain the agreement”, but she ruled out the threat of fresh sanctions on Russia.
“I think today the issue is not going to be discussion of further sanctions… but rather positive ways the EU can contribute to make this first step just one of many others,” she told reporters in Brussels.
Photo RT
The US said the deal was a “significant step” but expressed concern over reports of continued fighting in eastern Ukraine, saying it was “inconsistent with the spirit of the accord”.
Last week, the US refused to rule out supplying “lethal defensive weapons” to Ukraine if diplomacy failed, but Russia says that would worsen the crisis.
Speaking after the talks ended, Vladimir Putin told Russian television: “It wasn’t the best night for me, but it’s a good morning.”
Petro Poroshenko – who had accused Russia of making “unacceptable” demands – said that “despite tension and pressure” Ukraine had not succumbed to “ultimatums”.
Russia rejects accusations by Ukraine and Western powers that it is supplying weapons and personnel to the rebels – who are seeking independence for the areas they control.
The separatists gave the agreement a cautious welcome.
In Luhansk, rebel leader Igor Plotnitskiy said: “We hope that thanks to our efforts today, Ukraine will change and stop firing at civilians, hospitals and socially important facilities.”
Donetsk separatist leader Alexander Zakharchenko said Kiev would be to blame if the ceasefire collapsed and warned that there would “be no meetings and no new agreements”.
More than 5,400 people have been killed since the conflict began. There has been a dramatic rise in casualties in recent days, with 263 civilians killed in populated areas between January 31 and February 5.
Minsk agreement includes:
Ceasefire to begin at 00:01 local time on February 15
Heavy weapons to be withdrawn, beginning on February 16 and completed in two weeks
All prisoners to be released; amnesty for those involved in fighting
Withdrawal of all foreign troops and weapons from Ukrainian territory. Disarmament of all illegal groups
Ukraine to allow resumption of normal life in rebel areas, by lifting restrictions
Constitutional reform to enable decentralization for rebel regions by the end of 2015
Ukraine to control border with Russia if conditions met by the end of 2015 [youtube wfjiPYru3T0 650]
President Vladimir Putin has renewed the blame on the West for the Ukrainian crisis, as he works on Franco-German proposals to end fighting between the government and pro-Russia rebels.
Western countries had broken pledges not to expand NATO and forced countries to choose between them and Russia, Vladimir Putin told an Egyptian newspaper.
The comments come amid new hopes of a peace deal on February 11.
Russia denies accusations of sending troops and supplying the rebels.
The fighting in eastern Ukraine has claimed more than 5,300 lives and driven 1.5 million people from their homes.
At least nine Ukrainian soldiers have been killed in the past 24 hours, officials say.
Photo RT
Fighting is said to be intense around the town of Debaltseve, near the rebel-held city of Donetsk.
German Chancellor Angela Merkel is due to brief President Barack Obama in Washington on February 9 on the peace plan Germany and France have tried to reach with Ukraine and Russia.
The Washington talks come as the US considers sending weapons to the Ukrainian government.
Angela Merkel told a security conference at the weekend that she could not “imagine any situation in which improved equipment for the Ukrainian army leads to President Putin being so impressed that he believes he will lose militarily”.
Secretary of State John Kerry has denied any rift with EU leaders, saying: “I keep hearing people trying to create one. We are united, we are working closely together.”
Angela Merkel and French President Francois Hollande have been leading efforts to revive the Minsk peace plan, which collapsed amid fighting over the winter.
The detailed proposals have not been released but the plan is thought to include a demilitarized zone of 50-70km (31-44 miles) around the current front line.
The four leaders have announced plans to meet in Minsk on February 11 – provided agreement is reached in the meantime in talks in Berlin.
German Foreign Minister Frank-Walter Steinmeier said on February 9 there were hopes for a settlement but nothing had been agreed.
At the start of a visit to Egypt, President Putin renewed his attack on Western countries for their “hollow” promises not to expand NATO to include former Soviet countries, and therefore ignoring Russian interests.
There had been attempts, Vladimir Putin told Egypt’s al-Ahram newspaper, “to tear states which had been parts of the former USSR [Soviet Union] off Russia and to prompt them to make an artificial choice <<between Russia and Europe>>”.
“We repeatedly warned the US and its Western allies about harmful consequences of their interference in Ukrainian domestic affairs but they did not listen to our opinion,” the Russian leader said.
Vladimir Putin went on to accuse them of supporting a “coup d’etat in Kiev” – a reference to the ousting of former Ukrainian President Viktor Yanukovych last year.
Viktor Yanukovych lost power amid protests over his decision to scrap a deal that would have seen Ukraine establish closer ties with the European Union.
Since then, Russia has annexed Ukraine’s Crimea Peninsula and rebels in the east have sought to establish full control over the regions of Donetsk and Luhansk.
President Barack Obama has signed an executive order banning the export of goods, technology and services to Crimea.
The executive order also imposes new sanctions on certain Russian and Ukrainian individuals and companies.
The West has imposed various sanctions on Russia since it annexed Crimea after the removal of Ukraine’s pro-Moscow President Viktor Yanukovych in February.
Barack Obama said his latest decision was to show that the US would not accept Russia’s annexation.
The annexation was followed in April by pro-Russian separatists taking control of parts of the Donetsk and Luhansk regions of eastern Ukraine and declaring independence.
Some 4,700 people have died and another million have been displaced by fighting since then, the UN says.
On December 19, five Ukrainian soldiers were killed in fighting – the highest death toll since the latest attempt at a ceasefire began on 9 December.
Barack Obama said in a statement: “The executive order is intended to provide clarity to US corporations doing business in the region and reaffirm that the United States will not accept Russia’s occupation and attempted annexation of Crimea.”
Photo AP
In addition to the goods, technology and services ban, US individuals or companies cannot now buy any real estate or businesses in Crimea or fund Crimean firms.
The new measures also include sanctions on 24 Ukrainian and Russian individuals and on a number of companies deemed to be destabilizing Ukraine.
They include the Russian equity investment group, Marshall Capital Partners, and the Night Wolves biker group, over its involvement in Crimean military action.
Meanwhile, the EU imposed its own new sanctions against the Crimea region.
Like the EU, Barack Obama said he would not yet impose new sanctions on Russia, urging it again to de-escalate the tension in eastern Ukraine.
Russian Foreign Minister Sergei Lavrov said that “threatening new sanctions against Russia could undermine the possibility of normal cooperation between our countries for a long time”.
Barack Obama said: “I again call on Russia to end its occupation and attempted annexation of Crimea, cease its support to separatists in eastern Ukraine, and fulfill its commitments under the Minsk agreement.”
The agreement signed by Ukraine and the rebels in Minsk, in Belarus, in September, put in place a ceasefire and set out the terms for a peace process.
Rebels in eastern Ukraine are holding elections denounced by the West as “illegitimate”.
Presidential and parliamentary polls are being held in the two self-proclaimed people’s republics in the Donetsk and Luhansk regions.
Ukraine, the US and EU say they will not recognise the elections but Russia has given its support to the polls.
At least seven Ukrainian soldiers have been killed since Friday amid intensified clashes in the region.
The Donetsk and Luhansk regions fell to separatists after months of fighting in eastern Ukraine that ended with the Minsk ceasefire deal in September.
Rebel leaders say that as independent states they are not required to observe Ukrainian law and therefore did not participate in Ukraine’s national elections last week.
They say three million ballots have been printed for the polls, which will provide for directly elected presidents and parliaments.
Presidential and parliamentary polls are being held in the two self-proclaimed people’s republics in the Donetsk and Luhansk regions
“These elections are important because they will give legitimacy to our power and give us more distance from Kiev,” Roman Lyagin, election commission chief of the Donetsk region, told the AFP news agency.
Western leaders and ministers in the capital Kiev say the territories must abide by the truce, which was agreed with Russia, and hold local elections under Ukrainian law in December.
“We deplore the intent of separatists in parts of eastern Ukraine to hold illegitimate so-called local <<elections>> on Sunday,” the White House said in a statement on October 31.
However, Russian President Vladimir Putin has said the Minsk deal provided for elections “in co-ordination with, not in line with” Ukrainian plans.
Alexander Zakharchenko, the acting head of government in Donetsk, is widely tipped to become the region’s president.
Meanwhile, Igor Plotnitsky is being touted by Russian media as the favourite to win in Luhansk.
The elections come amid continuing violence in eastern Ukraine.
A spokesman for Ukraine’s army said on November 1 that seven soldiers had been killed and 10 wounded during 24 hours of fighting across the breakaway regions.
At least 3,700 people have been killed in fighting since armed separatists took over government buildings in Donetsk and Luhansk in April.
President Vladimir Putin and key EU leaders have met Ukrainian President Petro Poroshenko in Milan to discuss the eastern Ukraine crisis.
The leaders of the UK, Germany, France and Italy were expected to press Vladimir Putin to do more to end the fighting.
Italian PM Matteo Renzi said after the talks he was “more positive” on prospects for a solution to the crisis.
The West accuses Russia of arming separatist rebels and sending regular troops to Ukraine. Moscow denies this.
Ukraine and the rebels agreed a truce in September, but each side accuses the other of repeated shelling.
The separatists control parts of Ukraine’s Donetsk and Luhansk regions.
More than 3,600 people have been killed since the fighting erupted in April, following the annexation by Russia of Ukraine’s southern Crimea peninsular a month earlier.
Vladimir Putin and key EU leaders have met Ukrainian President Petro Poroshenko in Milan to discuss the eastern Ukraine crisis
Vladimir Putin, Petro Poroshenko and EU leaders met on the sidelines of the Asia-Europe (ASEM) summit in the northern Italian city.
The other participants in the meeting included UK Prime Minister David Cameron, French President Francois Hollande, German Chancellor Angela Merkel and Matteo Renzi.
Speaking briefly after the talks, the Italian prime minister said they were constructive but big differences remained.
“I’m more positive, I hope we can work together very strongly,” he told journalists.
Petro Poroshenko met Angela Merkel ahead of Friday’s talks, with both expressing regret that many points of a peace plan agreed last month in the Belarusian capital Minsk “had not yet been implemented”, German government sources were quoted as saying by the AFP news agency.
Angela Merkel also met Vladimir Putin for two-and-a-half hours late on Thursday, October 16.
Russian media quoted Kremlin spokesman Dmitry Peskov as saying that there were still “serious differences” between the two leaders over the origins of the crisis.
Angela Merkel said it was “first and foremost” Russia’s responsibility to make sure the peace plan was being followed.
Among other points, the plan envisages the withdrawal of heavy weaponry 10 miles by each side from the line of contact and the withdrawal of all foreign mercenaries from the conflict zone.
Earlier this week, Vladimir Putin ordered the withdrawal of nearly 18,000 Russian troops stationed near the Ukrainian border.
However, NATO says it has seen no sign of any major Russian pullback.
Speaking ahead of the Milan talks, Vladimir Putin stressed that he would not be blackmailed by the EU and US over the Ukrainian crisis.
In what was seen as a direct reference to President Barack Obama, the Russian leader warned of “what discord between large nuclear powers can do to strategic stability”.
The two-day ASEM summit brings together more than 50 member states.
President Vladimir Putin has ordered thousands of Russian troops stationed near the Ukrainian border to return to their bases, Russian media report.
Vladimir Putin’s spokesman said about 17,600 soldiers on training exercises in the Rostov region would be pulled back.
Russia has previously announced troop withdrawals that NATO and the US say were not actually carried out.
It has been accused of supplying troops and weapons to separatist rebels in east Ukraine – claims it denies.
The latest order comes ahead of a planned meeting between Vladimir Putin and Ukrainian President Petro Poroshenko on Friday, October 17.
Ukrainian troops have been fighting pro-Russia rebels in the regions of Donetsk and Luhansk since April, in a conflict that has killed more than 3,500 people.
The two sides agreed a truce on September 5, but fighting has continued, especially in and around Donetsk.
President Vladimir Putin has ordered Russian troops stationed near the Ukrainian border to return to their bases (photo Reuters)
“[Vladimir] Putin has ordered to start the returning of troops to regular station,” presidential spokesman Dmitry Peskov said in quotes carried by Interfax and Ria Novosti news agencies.
Dmitry Peskov said this was because the period of training was completed.
Vladimir Putin made similar statements about withdrawing troops from the Ukrainian border in March and May.
However, NATO and US officials said they saw no evidence of soldiers being moved.
Correspondents say the deployment of Russian troops on Ukraine’s border is seen as a powerful tool designed to threaten the government in Kiev.
Meanwhile, Vladimir Putin and Petro Poroshenko are expected to meet on the sidelines of the Asia-Europe Meeting (ASEM) summit in Italy on October 17.
President Petro Poroshenko told reporters: “I don’t expect the talks will be easy.”
“Russia’s role in the issue of providing peace… is difficult to overestimate,” he added.
Petro Poroshenko said he also hoped to discuss Russia and Ukraine’s gas pricing dispute.
Russia cut off gas supplies to Ukraine in June, saying the Kiev government had not settled its debts.
Ukraine could face gas shortages in the winter if the dispute is not resolved.
Ukraine’s rebel forces are conducting an offensive to capture the government-held airport in Donetsk, officials say.
Pro-Russian rebels have tried several times in recent weeks to take the airport, which lies to the north-west of the city.
The insurgents continued an offensive – begun on Wednesday, October 1 – on “a broad front”, the Ukrainian military says.
An official truce in place in eastern Ukraine has often been violated.
Ukraine’s rebel forces are conducting an offensive to capture the government-held airport in Donetsk (photo Reuters)
The cease-fire was called on September 5, but, on October 1, four people were killed by a shell which landed on a school in Donetsk, and six died when a minibus was hit.
A spokesman for what the Ukrainian government calls its anti-terrorist operation said Ukrainian forces repelled four attacks on the airport on Wednesday evening.
A T-64 tank was destroyed and seven rebels were killed, Vladyslav Seleznyov told Kanal 5 TV.
The rebels used tanks, multiple-launch rocket systems, artillery and mortars, Vladyslav Seleznyov said, resuming their attacks on Thursday morning with small-arms fire.
Ukraine will start the withdrawal of heavy weaponry from separatist rebel lines in the east, the military says.
The two sides agreed on September 20 to set up a buffer zone in eastern Ukraine, more than a fortnight after a shaky ceasefire came into force.
Although the truce is still in place, clashes have continued around the cities of Donetsk and Mariupol.
More than 3,000 people have died since fighting broke out in the two regions of Donetsk and Luhansk in April.
Ukraine’s parliament passed a bill last week granting three-year “self-rule” to parts of the Donetsk and Luhansk regions – a decision condemned by some lawmakers as “capitulation”.
Under the terms of the nine-point deal agreed in Belarus, both the pro-Russian rebels and Ukrainian forces are to pull back their heavy artillery 9.5 miles from the line of engagement, creating a 20 miles buffer zone.
Ukrainian National Security and Defense Council spokesman Col Andriy Lysenko said pro-Russian rebels had for their part begun moving their heavy artillery, but it was “not as massive as we expected”.
Ukraine will start the withdrawal of heavy weaponry from separatist rebel lines in the east (photo Reuters)
Artillery and armored vehicles with a caliber greater than 100mm would be moved, but all other units and their weapons would remain in place, he said.
According to the deal, military aircraft are banned from flying over the conflict zone and “foreign mercenaries” are to be withdrawn on both sides.
Foreigners are known to be fighting on both sides and Russia has repeatedly insisted that any of its citizens fighting alongside separatists in Ukraine are doing so in a private capacity.
Checkpoints manned by Ukrainian forces had come under heavy shelling at Donetsk airport and near Mariupol, Ukrainian media reported on Monday.
Col. Andriy Lysenko said that two servicemen had been killed in the past day.
Russia has been criticized by western leaders for its “destabilizing” influence on the crisis in Ukraine, at the start of a NATO summit in Wales.
NATO and the UK warned that pressure on Russia would be increased if it did not change course in eastern Ukraine.
Prior to the summit, Ukraine’s President Petro Poroshenko briefed US and EU leaders on earlier discussions on a cease-fire plan with Russian President Vladimir Putin.
Some 2,600 people have died in fighting between Ukrainian troops and rebels.
The West says it has evidence that Vladimir Putin is supporting the separatists with training and arms, and has sent Russian troops across the border. Russia denies the accusation.
The conflict has forced more than a million people from their homes in eastern Ukraine, according to the UN estimates.
Ukrainian government forces have recently suffered several losses, after rebels launched offensives in both the Luhansk and Donetsk regions, and further south around the city of Mariupol on the Azov Sea.
Reports are emerging that the separatists have begun shelling the outer defenses of Mariupol.
NATO Secretary-General Anders Fogh Rasmussen told reporters the summit in Wales is taking place in a dramatically changed security environment, with Russia attacking Ukraine (photo Reuters)
At least two military vehicles were seen on fire in the area, and eyewitnesses spoke of gunfire.
In a separate development, President Petro Poroshenko said “the implementation” of his peace plan – which includes a bilateral cease-fire – could start on September 5.
Petro Poroshenko said this depended on planned talks in Minsk between representatives of Ukraine, Russia, the pro-Russian rebels and the Organization for Security and Co-operation in Europe (OSCE).
During the two-days of talks, NATO leaders are also set to discuss the rise of Islamic State (ISIS), and Afghanistan where Taliban militants launched a deadly attack on a government compound on September 4.
Earlier today, NATO Secretary-General Anders Fogh Rasmussen said the summit was taking place in a “dramatically changed security environment”, with Russia “attacking Ukraine”.
“We are still witnessing unfortunately Russian involvement in destabilizing the situation in eastern Ukraine,” he told journalists in Newport ahead of the summit’s official launch.
Correspondents say the summit is NATO’s most important for decades, as leaders faced the question of whether the alliance is equipped to deal with 21st Century challenges.
NATO is expected to approve plans to create a rapid response force composed of several thousand troops from member states, able to deploy within 48 hours.
European leaders are also set to discuss a new round of tougher economic measures against Russia.
Russia has been given by the European Union one week to reverse course in Ukraine or face new sanctions.
European Council President Herman Van Rompuy said the EU was working urgently on further restrictive measures.
Earlier, Ukrainian President Petro Poroshenko said his country was “close to a point of no return – full scale-war” with Russia.
Russia denies Western accusations that its forces have illegally crossed into Ukraine to support separatists there.
Pro-Russian rebels have made gains against Ukrainian troops in recent days in the eastern Donetsk and Luhansk regions.
Some 2,600 people have died in fighting.
The conflict in the east erupted in April following Russia’s annexation of Ukraine’s southern Crimea peninsula a month before.
Western leaders say there is clear evidence of regular Russian military units operating inside Ukraine with heavy weapons.
Speaking after a summit in Brussels, Herman Van Rompuy said the EU “stands ready to take further significant steps in light of the evolution of the situation on the ground.
“Everybody is fully aware that we have to act quickly.”
Herman Van Rompuy did not specify the nature of further sanctions, but said the proposals would be ready within a week.
The US applauded the EU’s move.
Speaking in Brussels, President Petro Poroshenko said Ukraine was a victim of military aggression and terror (photo AFP)
“We welcome the European Council’s consensus today to show strong support for Ukraine’s sovereignty and territorial integrity and to prepare further sanctions for consideration in coming days,” White House National Security spokeswoman Caitlin Hayden said.
The EU and US have already imposed asset freezes and travel bans on many senior Russian officials and separatist leaders in eastern Ukraine.
Western sanctions also restrict loans for Russian state banks, block defense-related technology exports and certain oil industry exports to Russia.
Russia denies that its forces are backing the rebels, instead accusing Ukrainian forces of aggression and deliberately firing at civilians.
Speaking in Brussels, President Petro Poroshenko said Ukraine was a victim of “military aggression and terror”.
“Any offensive action which would be undertaken [by Russia]… would be a point of no return. And that’s why we undertake enormous efforts to stop that.”
Petro Poroshenko also said that he would discuss the possibility of a ceasefire at a meeting in Belarus on Monday of the Contact Group, which includes Ukraine, Russia, Belarus and the Organization for Security and Cooperation in Europe (OSCE).
Federica Mogherini, named on August 31 as Catherine Ashton’s successor, said there could be no military solution to the crisis and that while sanctions were being worked on, the diplomatic process would need to continue.
Ukraine’s government forces have lost ground in recent fighting.
A Ukrainian military spokesman said on August 30 that Russian tanks had attacked the town of Novosvitlivka near Luhansk and “destroyed virtually every house”.
Spokesman Andriy Lysenko said troops had been ordered to retreat from Novosvitlivk.
Ukrainian soldiers have also been trying to evacuate Ilovaisk in the Donetsk region, which has been surrounded by the rebels. Reports say a number of soldiers have been killed in shelling by the separatists.
Rebel leader Alexander Zakharchenko told the Russian News Service radio station a new offensive was being planned to create a corridor between Donetsk and Luhansk.
In south-eastern Ukraine, people have been leaving the port city of Mariupol, after advancing rebels captured Novoazovsk to the east.
Western and Ukrainian officials say this offensive has been substantially helped by Russian regular troops, opening a new front. Russia denies the accusation.
Germany’s Foreign Minister Frank Steinmeier has warned that the crisis in eastern Ukraine is “slipping out of control” and needs to be reined in to avoid a military clash with Russia.
Frank Steinmeier made the remarks on the eve of an EU summit which will consider further sanctions against the Russian government.
Russia has denied claims by NATO that its forces illegally crossed into Ukraine to support separatists there.
Some 2,600 people have died in fighting between rebels and Ukrainian troops.
The conflict erupted in April when Russia’s annexation of Crimea prompted rebels to take control of large parts of the eastern regions of Donetsk and Luhansk.
Russian President Vladimir Putin has blamed Ukraine for the crisis, comparing its siege of Donetsk and Luhansk to the siege of Leningrad by Nazi Germany in World War Two.
Russia could face new restrictions after a summit of the European Union’s 28 heads of state in Brussels on Saturday.
The EU and the US have already imposed sanctions against dozens of senior Russian officials, separatist commanders and Russian firms accused of undermining Ukrainian sovereignty.
Russia has denied claims by NATO that its forces illegally crossed into Ukraine to support separatists there (photo Reuters)
In late July, the EU also blacklisted some key economic sectors, prompting Russia to retaliate by banning food imports.
Russia’s energy minister has warned that the Ukrainian crisis could lead to a disruption of gas supplies to European countries this winter.
Earlier on Friday, NATO held an emergency meeting after releasing satellite images it said showed columns of Russian armed forces inside Ukrainian territory.
NATO Secretary-General Anders Fogh Rasmussen called on Russia to “take immediate and verifiable steps towards de-escalation”.
Anders Fogh Rasmussen also indicated NATO could consider Ukraine’s application to join the alliance, shortly after PM Arseny Yatsenyuk announced he was putting Ukraine on course for NATO membership.
Meanwhile, heavy fighting has continued near the strategic port of Mariupol on the Azov Sea. Rebel forces are trying to capture the city but Ukrainian government troops are digging in.
On August 28, the separatists seized the nearby town of Novoazovsk.
The separatists’ advance toward Mariupol has raised fears that the Kremlin might seek to create a land corridor between Russia and Crimea.
Rebels are also reported to have surrounded government soldiers in several places further north, near Donetsk city.
Global oil prices have reached their lowest level in nine months, despite fears that conflicts in Ukraine and Iraq would inflate prices.
Brent crude oil has fallen to $103.70 a barrel, its lowest rate since November 2013.
In July 2014, oil hit its highest level in nine months, valued at $115.71 per barrel. Violence in Iraq was cited as the reason for the rise.
The current dip in price has led to an increase in demand from wealthy states.
Global oil prices have reached their lowest level in nine months, despite fears that conflicts in Ukraine and Iraq would inflate prices
Iraq has scheduled to export about 2.4 million barrels per day of Basra Light crude in September, up from 2.2 million in the previous month.
In a report on Tuesday, the International Energy Agency (IEA) said: “Oil prices seem almost eerily calm in the face of mounting geopolitical risks spanning an unusually large swathe of the oil-producing world.”
The IEA said that while tensions in Iraq and fighting in Ukraine continued, other oil resources were available, such as those of the US, Libya and Saudi Arabia.
The agency said: “The Atlantic market is currently so well supplied that incremental Libyan barrels are reportedly having a hard time finding buyers.”
It had been thought that sanctions imposed by the US and EU on Russia over its support for Ukrainian rebels might affect oil distribution.
However, the IEA said: “The consensus in the industry seems to be that neither set of sanctions will have any tangible near-term impact on supplies.”
Russian Foreign Minister Sergei Lavrov has ruled out holding fresh talks in Geneva to defuse the Ukraine crisis, unless pro-Russian opposition groups are involved.
Sergei Lavrov added there was no point as an April accord between the US, EU and Russia had not been implemented.
He spoke after a Council of Europe meeting which was expected to support Ukraine’s plans for a May 25 election.
But Sergei Lavrov called an election “unusual” at a time when the army was being used against the population.
Ukrainian acting Foreign Minister Andriy Deshchytsia said Ukraine was ready to back a new round of talks in Geneva as long as Moscow supported presidential elections.
“If Russia is ready to commit itself to support these elections and to eliminate this threat and eliminate its support for the extremist elements in Ukraine, we are ready to have such a round of meetings,” he said at a news conference.
Andriy Deshchytsia later appealed for international observers to be sent to Ukraine to monitor the elections on May 25.
“[We] also asked the partners to make everything possible to eliminate the external threats and provocations supported by Russia in Ukraine to allow these elections to take place in a free and democratic way,” he added.
Russian Foreign Minister Sergei Lavrov has ruled out holding fresh talks in Geneva to defuse the Ukraine crisis
OSCE Chairman Didier Burkhalter said there should be a ceasefire in Ukraine ahead of the May presidential election – as holding it is very difficult in the current situation, the AFP news agency reports.
In recent days, security forces have launched a crackdown on pro-Russian separatists in the east of the country, triggering clashes outside the town of Sloviansk.
Interior Minister Arsen Avakov said on Tuesday that four soldiers and an estimated 30 separatists had been killed in the “anti-terrorism operation”.
He said that up to 800 well-trained militants armed with large-calibre weapons and mortars were hiding among civilians in the town, where government buildings have been seized and checkpoints set up.
A Russia Today reporter in Sloviansk said residents were stockpiling food and there were barricades on almost every road.
In the southern port of Mariupol, where the city council building was seized a week ago by pro-Russia militants, there were reports of gunfire near a military base close to the city’s airport, local media reported.
Tyres were also set on fire in the city centre, giving off thick smoke, they said.
Meanwhile, many flights in and out of Donetsk were suspended. The Ukrainian aviation authorities gave no reason for the move.
New checkpoints were earlier set up around Kiev. The interior ministry said it wanted to prevent the movement of weapons and explosives.
The authorities also attempted to re-establish control over Odessa, with Interim President Oleksandr Turchynov dismissing the acting head of the regional administration, Volodymyr Nemyrovskyy.
Forty-six people died in the Black Sea city on Friday in a fire at an official building and fighting between pro-Russian and pro-Ukrainian protesters.
At a news conference in Vienna on Tuesday, Sergei Lavrov said holding further international talks on Ukraine as some have suggested would be like “going round in circles”.
Instead, he explained, the government in Kiev and their Western backers needed to implement the series of steps to resolve the crisis that they had agreed in Geneva on April 17.
Under the agreement, all parties, including the separatists in eastern Ukraine, were to “refrain from violence, intimidation and provocative acts”. It also said those occupying buildings would have to leave them and be disarmed in return for an amnesty.
They also agreed to an inclusive constitutional process that would include the establishment of a broad national dialogue and consideration of proposed amendments.
Sergei Lavrov said he was not against a follow-up meeting to discuss the accord, but that it would not “have any added value” unless representatives of the separatists were invited.
The May 25 presidential election was called after pro-Kremlin President Viktor Yanukovych was overthrown by pro-Western protesters in February.
“Scheduling an election during a time when the army is being used against a part of the population is not conventional – it’s not Afghanistan,” Sergei Lavrov noted.
Standard & Poor’s has downgraded Russia’s rating to “BBB-“from “BBB” – one notch above “junk” status.
The move comes as foreign investors continue to take money out of the country amid tensions over the situation in Ukraine.
Also on Friday, Russia’s central bank raised its key interest rate from 7% to 7.5% as it sought to defend the value of the rouble.
Announcing the downgrade, S&P said: “In our view, the tense geopolitical situation between Russia and Ukraine could see additional significant outflows of both foreign and domestic capital from the Russian economy.”
The credit ratings agency said this could “further undermine already weakening growth prospects”.
Standard & Poor’s has cut Russia’s rating to one notch above “junk” status (photo CBC)
S&P warned that further downgrades were possible if the West imposed tighter sanctions against Moscow.
Investors have been pulling money out of Russia since last year when the country’s economy ran into trouble, but this process has intensified in recent weeks amid concerns over Ukraine.
In the first quarter of this year, foreign investors have withdrawn $63.7 billion from Russia, and economic growth has slowed significantly – it is expected to grow at no more than 0.5% during 2014.
Russian shares, which have traded lower this week, fell further following the downgrade, with the MICEX stock index slipping over 1.6% at one stage.
Russia’s central bank said its rate rise was because of a higher inflation risk and the weakness of the rouble. The Russian currency has lost nearly 8% against the dollar this year.
The bank said its move would enable it to lower inflation to 6% by the end of 2014 and added it did not plan on cutting rates in coming months.
Russia’s Economy Minister Alexei Ulyukayev dismissed S&P’s move, saying that “partially, it is kind of a politically motivated decision”.
However, analysts said other credit rating agencies were likely to follow suit.
Pro-Russian militants in Donetsk say they will not leave the government building there, defying the Kiev authorities and threatening a new international deal on Ukraine.
The separatists’ spokesman said that the Kiev government was “illegal”, so they would not go until the Kiev government stepped down.
Russia, Ukraine, the EU and US earlier agreed that illegal military groups in Ukraine must leave official buildings.
They reached the deal in Geneva.
Pro-Russian militants in Donetsk say they will not leave the government building there, defying the Kiev authorities and threatening a new international deal on Ukraine
Alexander Gnezdilov, spokesman for the self-proclaimed Donetsk People’s Republic, said his group would evacuate the government building in the eastern city only when the “illegal” Kiev government vacated parliament and the presidential administration.
A tense standoff continues in eastern Ukraine, where pro-Russian separatists – many of them armed – are occupying official buildings in at least nine cities and towns.
Another protest leader in Donetsk said the separatists would not leave unless pro-European demonstrators in Kiev’s Maidan Square packed up their camp first.
President Barack Obama cautiously welcomed the Geneva deal, but warned that the US and its allies were ready to impose new sanctions on Russia if the situation failed to improve.
On Friday there were reports of some shooting in Serhiyivka, in Donetsk region.
Ukrainian paratroopers opened fire to remove a protesters’ roadblock in Serhiyivka, Interfax-Ukraine reported, quoting local sources. The details have not been confirmed.
Russia denies fomenting separatism in eastern and southern Ukraine.
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