WASHINGTON (REUTERS) - US Secretary of State John Kerry told Russian Foreign Minister Sergei Lavrov on Monday that Washington was watching events in eastern Ukraine with great concern and any further moves by Moscow to destabilise Ukraine would "incur further costs for Russia."

State Department spokesman Jen Psaki said Kerry "called on Russia to publicly disavowed the activities of separatists, saboteurs and provocateurs" in Ukraine.

She said the two discussed convening direct talks in the next 10 days between Ukraine, Russia, the United States and the European Union to defuse tensions.