EU moves towards tougher sanctions on Russia

(MILAN) - European Union foreign ministers on Friday cleared the way for tougher sanctions against Russia over what many of them described as its invasion of neighbour Ukraine.

With Germany warning that the crisis was spiralling "out of control", the mood among ministers at talks in Milan was sombre, said Elmar Brok, the chair of the European Parliament's Foreign Affairs Committee.

Brok, a close political ally of German Chancellor Angela Merkel, said it was now clear Russian President Vladimir Putin was bent on establishing a land connection between Russia and the Crimean peninsula, which Moscow annexed in March.

"There was not much happiness in there. They (the ministers) see all the negotiations, meetings and contact groups have no succès because Putin is using them as an alibi to win more time."

Although no decisions were taken here and some EU countries still harbour reservations over sanctions, European sources indicated that EU leaders were likely to task officials to draw up new punitive measures when they meet in Brussels on Saturday.

Brok added: "The only thing that can be done in the short term is that the European Council might decide to increase further sanctions, for example for the whole financial sector - hedge funds and all that, to make it more difficult for the Russian economy to be refinanced.

"I think they (EU leaders) will decide that the Commission should be making clear proposals in that direction."

That account of the mood here chimed with a hardening of Germany's official position in the wake of NATO reporting that Russia has more than 1,000 troops inside Ukraine.

Foreign Minister Frank-Walter Steinmeier told reporters: "All our hopes of de-escalation have been disappointed and the situation is showing signs that it is now out of control."

Fears of an all-out war have risen following NATO's claim of Russian troops fighting alongside pro-Moscow separatists -- an allegation which the Kremlin disputes.

Sweden's Carl Bildt said Russia had to be sent a clear message that its incursions into its neighbour's territory were unacceptable.

"This is the second invasion of Ukraine in a year. We have to call a spade a spade and stop playing around," Bildt said.

Echoing a recurring theme in Milan, Bildt's Danish counterpart Martin Lidegaard said the EU now needed to rethink its entire relationship with Russia.

"We think it calls for a reaction that Russia is now with troops on Ukrainian ground," Lidegaard said.

"In the short term we have to look at further sanctions and in the longer term we have to look at measures to reduce our energy dependency on Russia."

His comments came as Russia's energy minister warned that the crisis in Ukraine could lead to a disruption of Russian gas supplies to Western Europe this winter -- an outcome that would have serious implications for a number of EU states.

- Polish apples -

The strongest calls for tough action came from EU states that were once communist satellites of the Soviet Union.

Lithuania's Linas Linkevicus urged EU leaders to consider "all possible support" to the Ukrainian government, including the provision of military hardware.

"We are not talking about sending soldiers and, by the way, Ukraine is not asking for that," he stressed.

His Estonian counterpart Urmas Paet added: "There has been no real impact of sanctions. No one likes it but we have to move forward with further measures."

Radoslaw Sikorski said Poland would be looking to its EU partners for proposals "to stop Putin making further encroachments and to save Ukraine in its current form," describing in a tweet the situation as "war".

The Polish minister distributed a basket of his country's apples -- now banned from Russia as part of Moscow's counter-sanctions against the West -- to reporters.

"President Putin says they are poisonous," he said. "I can assure you they are delicious -- if you want to show what you think of his (Putin's) policies, eat a Polish apple!"

Informal meeting of the Ministers of European affairs (Gymnich)