EUROPEAN Union (EU) leaders yesterday gave Russia a week to reverse course in Ukraine or face a new round of sanctions as Kiev warned it was on the brink of “full-scale war” with Moscow.

    Fears are growing that the confrontation on the EU’s eastern borders could engulf the whole continent after Russia sent troops to back a new offensive by pro-Kremlin rebels in southeastern Ukraine.

    The decision on new sanctions will depend on the evolution of the situation on the ground but “everybody is fully aware that we have to act quickly,” EU summit chairman Herman Van Rompuy said.

    The EU leaders call on Russia to “immediately withdraw all its military assets and forces from Ukraine,” they said in a joint statement.

    NATO said last week that at least 1,000 Russian soldiers are in Ukraine. Russia denies that. NATO also says Russia has amassed some 20,000 troops just across Ukraine’s eastern border, which could rapidly carry out a full-scale invasion.

    The fighting between the military and Russian-backed separatists in eastern Ukraine has so far claimed 2,600 lives, according to U.N. figures.

    The U.S. and the EU have so far imposed sanctions against dozens of Russian officials, several companies as well as the country’s financial and arms industry. Moscow has retaliated by banning food imports.

    German Chancellor Angela Merkel said the new sanctions would target the same sectors as previous punitive measures, which also included an export ban for some high technology and oil exploration equipment.

    “If Russia continues to escalate the crisis it will come with a high cost,” said EU Commission President Jose Manuel Barroso. “It’s time for everyone to get down to the business of peace-making. It is not too late, but time is quickly running out,” he said.

    Several European leaders had called for additional sanctions at the outset of the meeting in Brussels, but the fear of an economic backlash apparently prevailed and led the bloc to grant Russia another chance at avoiding tougher action. New sanctions would have required unanimity among the leaders.

    Russia is the EU’s No. 3 trading partner and one of its biggest oil and gas suppliers. The EU, in turn, is Russia’s biggest commercial partner, making any sanctions more biting than similar measures adopted by the U.S.

    Ukrainian President Petro Poroshenko said a strong response was needed to the “military aggression and terror” facing his country.

    Conceding ground in the face of a reinvigorated rebel offensive, Ukraine said Saturday that it was abandoning a city where its forces have been surrounded by rebels for days. Government forces were also pulling back from another it had claimed to have taken control of two weeks earlier.

    (SD-Agencies)