THE HAGUE/FEODOSIA (REUTERS) - US President Barack Obama and major industrialised allies warned Russia on Monday it faced damaging economic sanctions if President Vladimir Putin takes further action to destabilise Ukraine following the seizure of Crimea.
Leaders of the Group of Seven, meeting without Russia, agreed to hold their own summit this year instead of attending a planned G8 meeting in the Russian Olympic venue of Sochi, along the Black Sea coast from Crimea, and to suspend their participation in the G8 until Russia changes course.
On a day when Kiev ordered its remaining troops to withdraw from Crimea and Russian forces used force to capture a marine base and a landing ship, leaders of the United States, Germany, France, Britain, Italy, Japan and Canada condemned what they called "Russia's illegal attempt to annex Crimea in contravention of international law".
They also agreed to work together to reduce their dependence on Russian oil and gas.
"We remain ready to intensify actions including coordinated sectoral sanctions that will have an increasingly significant impact on the Russian economy, if Russia continues to escalate this situation," they said in a joint statement.
The G7 leaders, who met on the sidelines of a nuclear security summit in The Hague, said they would meet again in Brussels in early June, the first time since Russia joined the G8 in 1998 that it will have been shut out of the annual summit of industrialised democracies.
Mr Obama, who has imposed tougher sanctions on Moscow than European leaders over its takeover of the strategic peninsula, told reporters: "Europe and America are united in our support of the Ukrainian government and the Ukrainian people".
"We're united in imposing a cost on Russia for its actions so far," he said of the visa bans and asset freezes slapped on senior Russian and Crimean officials.
Russian Foreign Minister Sergei Lavrov sought to play down the G8 boycott.
"If our Western partners believe the format has exhausted itself, we don't cling to this format. We don't believe it will be a big problem if it doesn't convene," he told reporters.
Earlier on Monday, Russian troops forced their way into a Ukrainian marine base in the port of Feodosia, overrunning one of the last remaining symbols of resistance, and later stormed and captured a Ukrainian landing ship, firing warning shots and stun grenades. No casualties were reported in either incident.
In Kiev, acting president Oleksander Turchinov told parliament the remaining Ukrainian troops and their families would be pulled out of the region in the face of "threats to the lives and health of our service personnel".
That effectively ends any Ukrainian resistance, less than a month since Mr Putin claimed Russia's right to intervene militarily on its neighbour's territory.
Despite the disruption to East-West relations, Washington wants other diplomatic business with Moscow to continue. US Secretary of State John Kerry held talks with Mr Lavrov after meeting the head of the Organisation for the Prohibition of Chemical Weapons, overseeing the destruction of Syria's toxic stockpile in action sponsored jointly by Washington and Moscow.