Europe mulls sanctions in response to Crimea referendum

The European Union on Sunday condemned the referendum in Ukraine's Crimea as illegal and is taking steps to increase sanctions against Russia over what many believe is a planned annexation of the bordering peninsula.

The contested vote on Crimea joining Russia further acerbated relations with Moscow, which has changed from a wary partner to a diplomatic adversary in the space of a few months. But the EU increasingly realizes change might not be imminent.

"We cannot have any short-term hopes now that the situation regarding Crimea can be changed so quickly," German Foreign Minister Frank-Walter Steinmeier told ZDF television. "I assume Russia has made all the preparations to bring Crimea into Russian territory."

Presidents Barack Obama and Vladimir Putin of Russia spoke after Crimea residents voted overwhelmingly to join Russia. Obama told Putin that the referendum would never be recognized by Washington. Obama also told him the vote violates the Ukrainian constitution and occurred under duress of Russian military intervention. He said the U.S. was prepared to impose additional penalties on Russia.

On Monday, EU foreign ministers will decide whether to impose asset freeze and visa sanctions and, if so, who to target. Further measures could be taken at an EU summit meeting of government leaders starting Thursday.

"The referendum is illegal and illegitimate and its outcome will not be recognized," European Council President Herman Van Rompuy and Commission President Jose Manuel Barroso said in a joint statement Sunday.

Britain, France and Germany echoed the statement by British Foreign Secretary William Hague that Moscow must face "economic and political consequences."

EU diplomats were working feverishly over the weekend to set up a list of Russian and Moscow-leaning officials from Ukraine who have been involved in pushing for the southern peninsula's secession and possible annexation. Diplomats said member states arrived at weekend talks with different suggestions, so a common list could be drawn up for Monday's meeting of the 28 foreign ministers to make a final decision.

The joint Van Rompuy-Barroso statement said the foreign ministers will "decide on additional measures" against Russia on Monday.

They would likely include military officials who ordered Ukrainian troops to leave their barracks in Crimea and others who were responsible for breakaway actions there. On the other hand, diplomats said they would shy away from economic operators at the moment.

Depending on developments in Moscow and Ukraine, further sanctions could follow during a two-day summit of EU leaders starting on Thursday.

An EU summit last week suspended talks with Russia on a wide-ranging economic pact and a visa agreement.

On top of that, the EU could move quickly, possibly within a week, to sign the political chapters of a far-reaching association agreement with the provisional government in Kiev, underscoring its support for the new Ukraine government.

EU diplomats in several capitals made it clear the West is unwilling to give up Crimea in the hope of preventing Moscow from moving into eastern Ukraine.

With further unrest in Russia-leaning eastern Ukraine expected, French Foreign Minister Laurent Fabius called on Moscow "to immediately take measures to avoid a dangerous and useless escalation."

Germany's Steinmeier said the "spiral of escalation" and political tit-for-tat measures would hurt all. "When you set off down the road it will continue — so I will advocate tomorrow that we proceed step by step, proceed in such a manner that a way out (can) always be found," Steinmeier said.

If Moscow takes further measures to acerbate the crisis, the EU leaders already have threatened what they have called "far-reaching consequences for relations in a broad range of economic areas."

Bound by tens of billions of dollars in trade, there is plenty to hurt one another.

Russia is the EU's third-largest trading partner, mainly because of oil and gas imports, with the EU being its biggest gas consumer. Germany, for example, gets 35 percent of its supplies from Russia.

Russia, in turn, buys everything from machinery to cars from Europe, its biggest trading partner, with exports to Russia totaling 123 billion euros ($170 billion) in 2012.

The big change in relations came when Ukraine's Moscow-leaning president, Viktor Yanukovych, made a last-minute decision to abandon an agreement to strengthen ties with the EU and instead sought closer cooperation with Russia. The EU accused Moscow of pressuring Ukraine to make the change and relations have fallen ever further from then on.