Ukraine crisis: G7 'to intensify Russia sanctions'
The G7 group of economic powers has agreed to intensify sanctions on Russia over its actions in Ukraine.
A G7 statement gave no detail of the sanctions, but US officials said they could announce measures by Monday.
The West accuses Russia of leading a secession rebellion in Ukraine's east, months after it annexed Crimea. Moscow denies the allegations.
Meanwhile, negotiators are trying to secure the release of international observers seized by pro-Russia gunmen.
Forces in the city of Sloviansk are still holding the eight European military observers and several Ukrainian army personnel who they seized on Friday and accuse of espionage.
The observers were taking part in a mission linked to the Organisation for Security and Co-operation in Europe (OSCE).Jets 'violated air space'
Rebel militia continue to occupy official buildings in a dozen eastern cities, defying the government in Kiev.
It's all reminiscent of a game of poker, with Moscow intent on raising the stakes and G7 leaders forced to match the Russians step-for-step.
The G7 statement is unequivocal - it blames Russia for failing to implement the Geneva accord that offered a diplomatic path out of this crisis. Accordingly, Moscow has now been hit with more Western economic sanctions, the details to be revealed in a matter of days. The G7 is still holding in reserve broader sanctions against the Russian banking or financial sectors. That would be a last-ditch threat to try to avert further military action against Ukraine.
But with Russian aircraft flying into Ukrainian air-space and Russian ground exercises under way there is an ever present danger of this crisis escalating out of control. Moscow will now be weighing up the likely cost of sanctions, set against the central importance of its strategic interests in Ukraine.
Russia has tens of thousands of troops deployed along its side of the border with Ukraine and has said it would act if its interests were threatened.
The US accused Russian jets of violating Ukraine's airspace on Friday in a further sign of escalation.
Pentagon spokesman Col Steven Warren said Russian aircraft had entered Ukrainian airspace several times in the past 24 hours.
Meanwhile, the G7 praised Ukraine for acting with restraint in dealing with the "armed bands" that had occupied government buildings.
But the group, which includes the US, UK, Germany, Japan, France, Canada and Italy, condemned Russia's "increasingly concerning rhetoric and ongoing threatening military manoeuvres".
"Given the urgency of securing the opportunity for a successful and peaceful democratic vote next month in Ukraine's presidential elections, we have committed to act urgently to intensify targeted sanctions and measures to increase the costs of Russia's actions," said the statement.
The US and EU already has assets freezes and travel bans in place target a number of Russian individuals and firms accused of playing a part in the annexation of Crimea.
On Friday, Ukraine's interior ministry said armed separatists had seized OSCE representatives, who were believed to be military observers from Germany, Denmark, Poland, Sweden and the Czech Republic.
- Nov 2013: President Viktor Yanukovych abandons an EU deal, sparking protests
- 20-21 Feb 2014: Dozens killed in Kiev clashes
- 22 Feb: Mr Yanukovych flees
- 27-28 Feb: Pro-Russian gunmen seize key buildings in Crimea
- 16 Mar: Crimea voters choose to secede in disputed referendum; Russia later absorbs region
- Apr: Pro-Russia activists take over official buildings and police stations in eastern Ukraine
Pro-Russian leaders in Sloviansk confirmed the bus had been stopped near the town of Sloviansk and said they were checking the identities of those on board.
The self-proclaimed mayor of Sloviansk, Vyacheslav Ponomaryov, said at least one passenger had been carrying maps showing separatist checkpoints in the area, which suggested "their involvement in espionage".
Last weekend, Mr Ponomaryov broadcast an appeal to President Putin asking for Russian troops to protect the city from "fascists" after three of his men died in a gunfight.
Russia's OSCE envoy Andrei Kelin promised to take "all possible steps" to free the representatives, according to Russian media reports .