EU hits Russia with new sanctions over Ukraine

Tough new EU sanctions came into effect against Russia over the Ukraine crisis today, with Moscow angrily accusing its foes of trying to wreck the push for peace in the former Soviet state.

US President Barack Obama had also announced on Thursday that Washington would intensify punitive measures against Moscow over its "illegal actions" in Ukraine to further isolate the Kremlin, despite a ceasefire deal between Kiev and the pro-Russia separatists unveiled six days ago.

The coordinated announcements came after Kiev and NATO said around 1,000 Russian troops remained in Ukraine after allegedly crossing the border to bolster the separatist rebellion in what has been described as an invasion by stealth.

Kiev also acknowledged that the insurgents have extended their control over territory on the eastern border to the Sea of Azov after a lightning counter-offensive last month reportedly backed by elite Russian forces.

The European Union's latest restrictions target major Russian oil, finance and defence companies and impose asset freezes and visa bans on a host of Russian figures as well as rebels in Ukraine and annexed Crimea.

However, the 28-member bloc held out the prospect that they could be lifted after a review of the truce at the end of September.

The Russian ruble sank to a new historic low of 37.72 against the dollar today.

Moscow, its economy already on the brink of recession, had responded furiously to the new measures by its largest trading partner.

"By taking this measure, the EU has practically decided against the process of a peaceful settlement of the Ukrainian crisis," the foreign ministry said yesterday, urging Europe to give Ukraine "a chance for peace".

The EU move had been delayed after some member states -- wary that further Kremlin reprisals could hit their own fragile economies -- had said they wanted to wait and see what happened on the ground in Ukraine before acting.

Russia's neighbours in eastern Europe have accused energy giant Gazprom of slashing gas deliveries in what analysts say was a message directed at Brussels, although Moscow denied such a move.

Russia has threatened to bar EU airlines from its airspace, and said it has drawn up a list targeting imports of consumer goods and second-hand cars from the West.

European Council President Herman Van Rompuy said the EU could "amend, suspend or repeal" the sanctions depending on the results of a comprehensive review of the ceasefire at the end of the month.