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Oligarchs targeted in sanctions
A Ukrainian officer checks documents at the border crossing of Uspenka on the Ukrainian-Russian border (AP)
Billionaire oligarchs at the heart of Vladimir Putin's inner circle have been targeted for the first time for US sanctions over Crimea, as EU leaders meet in Brussels to discuss their own response to Russia's annexation of the strategically important Black Sea peninsula.
Barack Obama's imposition of travel bans and asset freezes on super-wealthy businessmen such as Mr Putin's banker Yury Kovalchuk, as well as officials including the president's chief of staff Sergei Ivanov, was met with a Cold War-style tit-for-tat retaliation by Moscow, which announced its own blacklist of US politicians.
Mr Obama also signed an executive order authorising American sanctions targeting key sectors of the Russian economy if the situation in Ukraine deteriorates further.
The US president's action is likely to overshadow discussions in Brussels, where leaders of the 28 European Union nations are expected to agree little more than an extension of the existing list of 21 Russian and Crimean officials subjected to visa restrictions and asset freezes. Action against the oligarchs who provide financial support for the Putin regime is not on the table.
However, officials at the Brussels talks stressed that the EU is offering a "carrot" of strengthened economic links with heavily-indebted Ukraine, as well as the "stick" of sanctions. Elements of an association agreement with Kiev are set to be signed tomorrow, four months after former president Viktor Yanukovych stepped away from the deal in a move which eventually led to his overthrow.
David Cameron and the other 27 EU leaders were discussing the Ukraine crisis over dinner on the first day of the regular two-day European Council summit.
As well as the extension of sanctions to more individuals deemed responsible for violations of Ukrainian sovereignty, the talks focused on preparations for the wider trade and economic measures threatened by the EU if Russia continues to escalate the situation.
One measure under discussion for possible immediate application was a requirement for imports from Crimea to carry a Ukrainian customs stamp, while other countries could agree their own suspension of arms export licences and military co-operation with Russia of the kind announced by Britain earlier this week.
Tensions remained high in Crimea itself, where p ro-Russian forces seized three Ukrainian warships and Kiev said its troops were being threatened. The lower house of Russia's parliament, the Duma, endorsed the absorption of the peninsula into their country by a near-unanimous vote of 445-1.
Speaking after meeting Mr Putin in Moscow, UN secretary general Ban Ki-moon said he "emphasised that all parties refrain from any hasty or provocative actions that could further exacerbate an already very tense and very volatile situation".
Arriving in Brussels, Mr Cameron called on Europe t o send a "clear and united" message to Russia, whose actions he described as "unacceptable".
"What that means is more asset freezes and travel bans, more action specifically in respect of what has happened in the Crimea, but also it means making sure that we do everything we can to help build a strong and democratic Ukraine," said the Prime Minister.
"One of the things we must do at this Council is sign a new agreement with the Ukraine, offering them a prosperous future, access to our markets and real political support."
The blacklist of 20 individuals unveiled by Mr Obama in Washington also included prominent businessman Gennady Timchenko and billionaire brothers Arkady and Boris Rotenberg, who were judo sparring partners of the Russian president, as well as Mr Putin's deputy chief of staff, Alexei Gromov, Duma Speaker Sergei Naryshkin and Russian Railways chairman Vladimir Yakunin. Mr Kovalchuk's Rossiya bank, which counts many senior officials among its clients, was the first institution to face sanctions.
Justifying the move to sanction private businessmen, Mr Obama said he was targeting " individuals with substantial resources and influence who provide material support to the Russian leadership as well as a bank which provides material support to these individuals".
He added: "The world is watching with grave concern as Russia has positioned its military in a way that could lead to further incursions into southern and eastern Ukraine.
"For this reason we have been working closely with our European partners to develop more severe actions that could be taken if Russia continues to escalate the situation.
"As part of that process, I signed a new executive order today that gives us the authority to impose sanctions not just on individuals but on key sectors of the Russian economy.
"This is not our preferred outcome. These sanctions will not only have a significant effect on the world economy, but can also be disruptive to the global economy.
"However, Russia must know that further escalation will only isolate it further from the international community."
Within minutes of Mr Obama's announcement, Russia imposed entry bans on nine US politicians and officials, including House Speaker John Boehner, Foreign Relations Committee chairman Bob Menendez and former presidential candidate John McCain.
Mr McCain tweeted a defiant response: "I'm proud to be sanctioned by Putin - I'll never cease my efforts & dedication to freedom & independence of Ukraine, which includes Crimea."
Mr Obama is due to meet other G7 states - the UK, France, Germany, Italy, Canada and Japan - to discuss Ukraine on the margins of a nuclear security summit in the Netherlands next week, when proposals to eject Russia from the wider G8 group of world powers will be discussed.
Speaking in Berlin ahead of the EU summit, German chancellor Angela Merkel said it was "obvious, as long as the political context for such an important format like the G8 does not apply - as is the case at the moment - the G8 doesn't exist any more, neither does the (Sochi) summit nor the format as such".
Before the official opening of the Brussels summit, Mr Cameron met leaders of Denmark, Sweden and the three EU members which share a border with Russia - Estonia, Latvia and Lithuania. The three Baltic states have voiced concern over the implications of Mr Putin's military aggression in Ukraine for their own security as well as the gas supplies they rely upon.
Britain has circulated a paper in Brussels on the diversification of EU energy sources to ensure security of supply.
The PM also had short discussions with Polish prime minister Donald Tusk, whose country shares a long land border with Ukraine.