G7 condemns Russia

Symbolically calling themselves the 'G7,' the leaders issued a joint statement declaring Russia's actions in Ukraine were incompatible with the principles of the Group of Eight Nations (G8), of which Russia is a member.

"We, the leaders of Canada, France, Germany, Italy, Japan, the United Kingdom and the United States and the President of the European Council and President of the European Commission, join together today to condemn the Russian Federation's clear violation of the sovereignty and territorial integrity of Ukraine," the statement, released by the White House, said. The G7 in its regular form is made up of the finance ministers of the countries to have issued the statement.

The group added it was suspending preparations for June's G8 summit in Sochi, Russia, "until the environment comes back where the G8 is able to have meaningful discussion."

The statement comes as the Russian military tightens its grip on Ukraine's Black Sea peninsula of Crimea.

According to US sources, Russian troops are now in control of Crimea, with more than 6,000 troops stationed in the region.

Russian forces surrounded several Ukrainian army bases on Sunday, a day after President Vladimir Putin won approval from parliament to use military force to protect ethnic Russian citizens living in Crimea.

Ukraine's interim Prime Minister Arseniy Yatsenyuk responded by calling up all military reservists, saying Moscow had put the two countries "on the brink of disaster."

"This is not a threat: this is actually the declaration of war to my country," he said in Kyiv.

G7 offers financial aid

Western nations have widely condemned Russia's actions, amid fears the crisis could reach Cold War proportions.

NATO leader Ander Fogh Rasmussen warned Sunday that the situation threatened "peace and security in Europe."

Meanwhile, US Secretary of State John Kerry said Russia risked losing its place in the G8.

He told CBS' "Face the Nation" Putin still had a "right set of choices" to end the crisis, otherwise the G8 and other countries were prepared to "go to the hilt to isolate Russia."

Kerry is due to travel to Kyiv on Tuesday in a show of support for the new interim government, which replaced Kremlin-ally President Viktor Yanukovych following his ouster late last month.

The finance ministers making up the G7 have also pledged to send financial aid to boost Ukraine's struggling economy, provided the government puts in place reforms sought by the International Monetary Fund.

Hope for political dialogue

Germany was able to offer a small glimmer of hope on Sunday, reporting that Putin had agreed to a proposal from Chancellor Angela Merkel to join a "fact-finding mission" and contact group aimed at easing tensions.

"The chancellor called upon [Putin] again to respect Ukraine's territorial integrity," deputy government spokesperson Georg Streiter said in a statement following a phone call between the two leaders.

Even though Putin defended his decision - directing Merkel's "attention to the unrelenting threat of violence … to Russian citizens and the whole Russian-speaking population [in Ukrainian territory]" - he also agreed to work with her to curb the diplomatic crisis.

"President Putin accepted the German chancellor's proposal to immediately establish a commission of enquiry as well as a contact group, possibly under the direction of the [Organization for Security and Co-operation in Europe] to open a political dialogue," a statement from Berlin said.

The chancellery did not provide further details about the proposed "contact group."

ccp/ph (AFP, Reuters, dpa, AP)