Ukrainian crews 'told to surrender'
Russian forces controlling the strategic region of Crimea have demanded that the crew of two Ukrainian warships must surrender, according to Ukrainian sources.
Ukrainian defence ministry spokesman Maksim Prauta said four Russian navy ships were blocking Ukraine's anti-submarine warship Ternopil and the command ship Slavutych in Sevastopol's harbour.
He said the Russians ordered the crew to surrender within the hour or face Russians storming and seizing the ships and crew.
Earlier today, Russia pressed hard for Ukrainian politicians to return to the February 21 agreement that promised to create a new unity government which would rule until an early election no later than December.
On the ground, Russian troops controlled all Ukrainian border posts in Crimea, as well as all military facilities and a key ferry terminal, cementing their stranglehold on the strategic Ukrainian peninsula.
Earlier in the day, Russian foreign minister Sergey Lavrov, at UN meetings in Geneva, explained the reasoning behind Russia's military invasion of Crimea.
"This is a question of defending our citizens and compatriots, ensuring human rights, especially the right to life," he said.
But there have been no reports of any hostilities toward Russian-speakers in Ukraine during the country's four months of political upheaval.
Tension between Ukraine and Moscow rose sharply after President Viktor Yanukovych was pushed out by a protest movement made up of people who wanted closer ties with the European Union, more democracy and less corruption.
Mr Yanukovych fled to Russia last month after more than 80 demonstrators were killed, mostly by police, near capital Kiev's central square but insists he is still president.
In Kiev, Ukraine's new prime minister admitted his country had "no military options on the table" to reverse Russia's military move into its Crimea region, where the Ukrainian military admitted that pro-Russian troops have surrounded or taken over "practically all" its military facilities.
While Prime Minister Arseniy Yatsenyuk appealed for outside help and insisted that Crimea still remained part of his country, European foreign ministers held an emergency meeting on a joint response to Russia's military move that could include economic sanctions. But there was no immediate response to the Russian statement, which would void the new government that Ukraine installed just last week.
"Any attempt of Russia to grab Crimea will have no success at all. Give us some time," Mr Yatsenyuk said at a news conference with UK Foreign Secretary William Hague in Kiev.
But he added that "for today" there were "no military options on the table". He said his country was "urgently" asking for economic and political support from other countries.
"Crisis diplomacy is not a weakness, but it is now more important than ever for us not to fall into the abyss of a military escalation," German foreign minister Frank-Walter Steinmeier said in Brussels.
In the meantime, Russian forces were clearly in charge in Crimea, home to two million mostly Russian-speaking people and landlord for Russia's critical Black Sea Fleet at Sevastopol.
In addition to seizing barracks and border posts, troops also controlled a ferry terminal in the Ukrainian city of Kerch, just 12 miles (20km) across the water from Russia. That intensified fears in Kiev that Moscow will send even more troops into the peninsula via that route.
The soldiers at the terminal refused to identify themselves, but they spoke Russian and their vehicles had Russian licence plates.
Border guard spokesman Sergei Astakhov said the Russians were demanding that Ukrainian soldiers and guards transfer their allegiance to Crimea's new pro-Russian local government. "The Russians are behaving very aggressively, they came in by breaking down doors, knocking out windows, cutting off every communication," he said.
He said four Russian military ships, 13 helicopters and 8 transport planes had arrived in Crimea in violation of agreements that permit Russian to keep its naval base at Sevastopol.
Now, fears in the Ukrainian capital of Kiev and beyond are that Russia might seek to expand its control by targeting and seizing other parts of Ukraine, especially in its pro-Russian east.
"The world cannot just allow this to happen," Mr Hague said, but he ruled out any military action. "The UK is not discussing military options. Our concentration is on diplomatic and economic pressure."
Ukraine is also struggling on the financial front. The treasury is almost empty and its currency is under pressure after years of running large deficits. The International Monetary Fund said a fact-finding mission would visit Ukraine starting tomorrow for 10 days. Ukraine has asked the IMF for rescue loans and says it needs 35 billion US dollars (£21 billion) to pay its bills over the next two years.
Market reaction to the Russian invasion of Crimea was immediate this morning. In European trading, gold and oil rose while the euro and stock markets fell. The greatest impact was felt in Moscow, where the main RTS index was down 12% at 1,115 and the dollar spiked to an all-time high of 37 rubles.
Russia's central bank hiked its main interest rate 1.5 percentage points today to 7%, trying to stem financial outflows. Gazprom, the Russian energy giant, was also big loser, its share price down 13% as investors worried about how it would get its gas to Europe if hostilities kept up, since much of it goes through Ukrainian pipelines.
Outrage over Russia's military moves has mounted in world capitals, with US secretary of state John Kerry calling on Russian president Vladimir Putin to pull back from "an incredible act of aggression". Mr Kerry is to travel to Ukraine tomorrow.
Mr Putin has rejected calls from the West, insisting that Russia has a right to protect its interests and those of Russian-speakers anywhere in Ukraine. His confidence is matched by the knowledge that Ukraine's 46 million people have divided loyalties, while much of western Ukraine wants closer ties with the 28-nation European Union, its eastern and southern regions like Crimea look to Russia for support and trade.
Faced with the Russian threat, Ukraine's new government has moved to consolidate its authority, naming new regional governors in the pro-Russia east, enlisting the support of the country's wealthy businessmen and dismissing the head of the country's navy after he declared allegiance to the pro-Russian government in Crimea.
Nato held an emergency meeting in Brussels and the US, France and Britain debated the possibility of boycotting the next G8 economic summit, to be held in June in Sochi, the host of Russia's successful Winter Olympics.