By Gregory L. White And Laurence Norman
U.S. and European leaders threatened new sanctions against
Moscow after a missile attack blamed on pro-Russian separatists
killed 30 civilians in the eastern Ukrainian city of Mariupol, the
latest escalation in violence that has brought Kiev's fight with
rebels back toward full-scale war.
Russia reacted with defiance, blaming Kiev and its western
backers for thee surge in fighting, but it also called for urgent
talks on implementing a September cease fire. Separatists backed
off earlier threats of a broad offensive on Mariupol and other
targets, but shelling along the contact line between the two sides
was "extremely heavy" over the weekend, Ukrainian military
officials said.
U.S. President Barack Obama said on Sunday he was "deeply
concerned" about the latest break in the cease fire and escalating
separatist aggression, saying he would continue to ratchet up
pressure on Russia.
"I will look at all additional options that are available to us
short of a military confrontation in trying to address this issue,"
the president said during a news conference in New Delhi.
The European Union, saying the rebels "bluntly refuse to
observe" the cease fire, called an emergency meeting of foreign
ministers for Thursday to discuss a response.
Diplomats said it isn't yet clear whether the West is unified
enough to agree substantial new sanctions against Russia,
particularly since the latest explosion in violence came as a
surprise, just as the EU had begun considering the conditions under
which it could start to ease some limits on Russia. The U.S.,
meanwhile, is wary of taking major new steps without Europe's
support.
Publicly, the Kremlin remains defiant, confident the Russian
public will blame the West for the worsening economic pain caused
by sanctions and the fall in oil prices. Kremlin insiders say the
leadership is giving mixed signals on whether it is seeking to win
an easing of sanctions by pressuring Kiev into a truce or preparing
for further escalation.
At the World Economic Forum in Davos, Switzerland, last week, a
top Russian official suggested the standoff with the West could
last "decades," saying that the government is looking at the
experience of regimes that suffered years of international
isolation, such as South Africa's apartheid government.
Moscow's apparent resilience in the face of a 50% drop in the
value of its currency and an economy pushed into recession has left
western capitals struggling to find effective levers to get the
Kremlin to change direction.
"The question is going to be whether they continue to pursue a
path where that not only is bad for the people of Ukraine but is
bad for the people of Russia, and are we able to continue to raise
the costs even as we're creating an off-ramp diplomatically that
eventually the Kremlin starts pursuing a more sensible policy in
resolving this issue," Mr. Obama said Sunday.
EU foreign policy chief Federica Mogherini warned Saturday in a
statement that further violence in eastern Ukraine "would
inevitably lead to a further grave deterioration of relations
between the EU and Russia."
But several senior EU diplomats said Sunday there were no
concrete ideas on the table yet for fresh Russia sanctions and the
discussion of options was only starting.
The EU has already introduced restrictions on trade, defense and
energy links with Russia, as well as targeted dozens of Russian
officials and separatist leaders with a freeze on assets and travel
restrictions.
Among the steps the EU and U.S. could take is widening the net
of companies frozen out of western financial markets to include
more state-run firms or private companies. They could also ban
exports of technology related to the gas industry in addition to
measures against Russia's oil sector.
One measure that has been discussed previously is whether to
seek to knock Russia off the Swift network, which is key to making
global financial transactions. In the past, diplomats have said
that would likely be a last resort.
Any fresh measures must be backed by all 28 EU member countries
and could face stiff resistance from Hungary, Cyprus and Greece,
which have repeatedly expressed concerns about the measures.
Late Saturday, EU President Donald Tusk, a former Polish prime
minister, signaled he favored a tough response. "Once again,
appeasement encourages the aggressor to greater acts of violence,"
he wrote on Twitter. "Time to step up our policy based on cold
facts, not illusions."
Also Saturday, the North Atlantic Treaty Organization accused
Moscow of "supporting (the) offensive operations" of the
separatists with heavy weapons. Russia has consistently denied such
charges.
In separate phone calls Sunday with Ms. Mogherini and U.S.
Secretary of State John Kerry, Russian Foreign Minister Sergei
Lavrov laid the blame for the latest surge in violence on Kiev,
which he accused of violating the terms of the September cease fire
by shelling rebel-held cities, the ministry said in a statement. He
called on his Western counterparts to push Kiev back into
negotiations.
But Ukrainian President Petro Poroshenko denied violating the
cease fire and said he remains committed to the September Minsk
agreements.
Rebels, however, said over the weekend they were pulling out of
talks because they hadn't yielded results. Separatist leaders sent
mixed signals on their military aims, however. After initially
announcing after the Mariupol missile strike that a broad attack on
the Ukrainian-held city was under way, top rebels reversed
themselves and told Russian state television they weren't planning
a siege. Saturday's missile strike hit a residential area, killing
30 and wounding about 100. Monitors from the Organization for
Security and Cooperation in Europe said the missiles came from
rebel-held territory, but separatists denied responsibility.
Ukrainian officials said there was no sign of a major assault
Sunday on Mariupol, a strategic port city that has been largely
spared from the fighting. A rebel push on Mariupol would be a major
escalation, but taking the city would give the economically
challenged rebels a much-needed seaport.
On Sunday, Ukrainian military spokesman Col. Andriy Lysenko said
elsewhere on the front, rebels were "shelling our forces with
extraordinary intensity using artillery, mortars,
grenade-launchers, tanks and 'Grad' missile launchers."
Heavy fighting was reported around Debaltseve, a Ukrainian-held
transport hub northeast of the rebel capital of Donetsk. Rebel
leaders said Saturday they aimed to surround Ukrainian troops
there. Russian military observers in the city evacuated last week,
citing security concerns, according to the OSCE.
Military analysts say the rebels' latest push appears to be an
effort to straighten out the jagged line dividing the two sides and
make their self-declared state more secure. The separatists won a
symbolic victory in that drive last week, forcing Ukrainian troops
to retreat from the devastated Donetsk airport.
Colleen McCain Nelson and Matthew Dalton contributed to this
article.
Write to Gregory L. White at greg.white@wsj.com and Laurence
Norman at laurence.norman@wsj.com