Obama Says Putin Running Out of Time Over Ukraine

June 5 (Bloomberg) -- Bloomberg Television’s “Money Clip” Host Adam Johnson looks at President Obama’s trip to Europe. (Source: Bloomberg)

Vladimir Putin has just weeks to stop supporting a pro-Russian insurgency in Ukraine or face stiffer penalties, U.S. President Barack Obama and U.K. Prime Minister David Cameron said.

“The G-7 nations are ready to impose additional costs on Russia” if Putin doesn’t take concrete steps to help end the rebellion in Ukraine, Obama told reporters after talks with Cameron today in Brussels. “We will have a chance to see what Mr. Putin does over the next two, three, four weeks.”

Those steps include completing a pullback of troops from the border and working constructively with President-elect Petro Poroshenko, Cameron said. Group of Seven leaders met for the second time since expelling Russia from what had been the G-8 over its annexation of Crimea from Ukraine in March.

More on the Crisis in Ukraine:

“Russia’s actions are completely unacceptable and totally at odds with this group of democracies,” Cameron said, adding that it’s “vital” Putin reverses course in the next few weeks. “The status quo is unacceptable. The destabilization of Ukraine must stop.”

As G-7 leaders met in Brussels, President Putin and Russian Foreign Minister Sergei Lavrov arrived in Paris, where Putin will hold talks with Cameron before dining with his French counterpart, Francois Hollande, and Lavrov met with U.S. Secretary of State John Kerry.

Photographer: Saul Loeb/AFP/Getty Images

U.S. President Barack Obama, counter-clockwise from center, sits alongside Angela Merkel, Germany's chancellor, David Cameron, U.K. prime minister, Matteo Renzi, Italy's prime minister, Shinzo Abe, Japan's prime minister, Stephen Harper, Canada's prime minister, Francois Hollande, France's president, Jose Manuel Barroso, president of the European Commission, and Herman Van Rompuy, president of the European Union, during a G-7 leaders working dinner at the European Council in Brussels. Close

U.S. President Barack Obama, counter-clockwise from center, sits alongside Angela... Read More

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Photographer: Saul Loeb/AFP/Getty Images

U.S. President Barack Obama, counter-clockwise from center, sits alongside Angela Merkel, Germany's chancellor, David Cameron, U.K. prime minister, Matteo Renzi, Italy's prime minister, Shinzo Abe, Japan's prime minister, Stephen Harper, Canada's prime minister, Francois Hollande, France's president, Jose Manuel Barroso, president of the European Commission, and Herman Van Rompuy, president of the European Union, during a G-7 leaders working dinner at the European Council in Brussels.

Kerry, Lavrov

Kerry said the U.S. hopes Ukraine can be a bridge between east and west, while Lavrov said both sides need to stop the violence, with the government declaring a cease-fire first.

The Russians will join events tomorrow in northern France to mark the 70th anniversary of the D-Day allied landings during World War II.

Russia this week submitted a draft UN Security Council resolution to establish corridors to supply humanitarian aid to people in the mainly Russian-speaking regions of Ukraine affected by the fighting, which has claimed almost 200 lives. Prime Minister Dmitry Medvedev said today that thousands of people have fled into Russian regions since the violence began.

The State Border Service in Kiev dismissed Medvedev’s claim, saying on its website that “not a single Ukrainian citizen has reported a desire to seek refuge in Russia.” The number of Ukrainians who traveled to Russia last month fell to 340,000 from 540,000 in May 2013, the service said.

G-7 United

Russia’s annexation of Crimea and menace to eastern Ukraine led the U.S. and the European Union to impose asset freezes and travel bans on 98 people and 20 companies, while stopping short of broader curbs on investment and trade that might also damage their own economies.

Photographer: Saul Loeb /AFP via Getty Images

U.S. President Barack Obama speaks during a joint press conference with British Prime Minister David Cameron during the G7 Summit at the European Council in Brussels, on June 5, 2014. Close

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Photographer: Saul Loeb /AFP via Getty Images

U.S. President Barack Obama speaks during a joint press conference with British Prime Minister David Cameron during the G7 Summit at the European Council in Brussels, on June 5, 2014.

The G-7 leaders warned Russia that “we stand ready to intensify targeted sanctions and to implement significant additional restrictive measures” in the absence of a peaceful settlement, according to a statement issued late yesterday. Obama said today G-7 nations are in “lockstep” over Ukraine, a country of about 46 million people.

German Chancellor Angela Merkel told reporters before a meeting with Poroshenko in Berlin today that Putin must support the new government of Ukraine and their talks will focus on what kind of support Russia is expected to contribute. Merkel is due to hold talks with Putin tomorrow.

Poroshenko said he’s determined to defend Ukraine’s territorial integrity from the “terrorists” being sent into the country to sow divisions.

‘Political Coercion’

Debate over further penalties is seething in the 28-nation EU, which relies on Russia for 30 percent of its natural gas. Germany’s government has faced down business leaders who objected to sanctions, while gas customers such as Slovakia have opposed a tougher line. Hollande reaffirmed plans to complete the sale of two Mistral helicopter carriers to Russia.

G-7 leaders warned Russia against using energy to force compliance with its political goals, according to a draft of the conclusions from the summit. Russia has set a deadline of June 10 for Ukraine to start paying for gas in advance.

“The use of energy supplies as a means of political coercion or as a threat to security is unacceptable,” the draft statement obtained by Bloomberg News reads. “The crisis in Ukraine makes plain that energy security must be at the center of our collective agenda.”

Fighting Continues

In Ukraine, the fighting continued in the easternmost Luhansk region and neighboring Donetsk, even as authorities said they were making progress in stopping the insurgency.

Militants attacked a checkpoint in Marynivka on the Russian frontier at 4:05 p.m. Kiev time today, the border service said on its website.

The rebels were armed with heavy machine guns and arrived in armored personnel carriers, trucks and minibuses, the service said. The air force responded with airstrikes that killed several “terrorists,” while others fled into Russia, according to the service. At least five patrolmen were wounded.

Control of some areas along the frontier are “utterly complicated” by a high concentration of rebels who are threatening family members of border patrol officers, the border service said in an earlier statement today. Ukraine shut seven border stations in Luhansk and one in Donetsk.

Authorities had more success in Krasny Lyman, a town about 25 kilometers (15 miles) northeast of Slovyansk in the north of Donetsk, which was retaken by the armed forces, Serhiy Pashynskyi, acting chief of the presidential staff, said on the presidential website. Nine districts in northern Luhansk, out of 18 in total, are back under government control, he said.

‘Absolutely Confident’

Pashynskyi said while he’s not expecting the operation to conclude quickly, “I am absolutely confident that if we move on consistently and if the cabinet, parliament and president and Ukrainian society act in sync, we will resolve this.”

Russia is “very worried” about the Ukrainian offensive, Foreign Ministry spokesman Alexander Lukashevich said at a briefing in Moscow. Russia is seeing an influx of refugees from Donetsk and Luhansk, he said.

The G-7 statement faulted Putin for stirring up the insurrection and called on the Kremlin “to exercise its influence among armed separatists to lay down their weapons and renounce violence.” The leaders also called on Ukraine’s authorities to “maintain a measured approach” in their operations to quell the violence.

Tomorrow’s D-Day commemorations will include a lunch where both Obama and Putin will be present. Merkel said that she would make clear the G-7 stance on Ukraine in her discussions with the Russian leader.

“I don’t plan to evade anyone,” Putin said in an interview with France’s Europe 1 and TF1 channel broadcast as the G-7 leaders met. “There will be other guests and I’m not going to avoid any of them. I’ll talk with all of them.”

To contact the reporters on this story: James G. Neuger in Brussels at jneuger@bloomberg.net; Kateryna Choursina in Kiev at kchoursina@bloomberg.net; Julianna Goldman in Washington at jgoldman6@bloomberg.net

To contact the editors responsible for this story: Alan Crawford at acrawford6@bloomberg.net; James M. Gomez at jagomez@bloomberg.net Brad Cook

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