Ukraine, Russia agree peace moves but fighting rages on

Ukraine, Russia agree peace moves but fighting rages on
Ukrainian fighters from the Azov Battalion stand guard at a checkpoint on the outskirts of Mariupol on Sept 2, 2014.

KIEV/ULAN BATOR - Russian President Vladimir Putin said on Wednesday a deal to end fighting in eastern Ukraine could be reached this week, a clear attempt to show the West he was trying to deescalate the conflict despite renewed shelling.

After speaking with Ukraine's Petro Poroshenko, Putin said their views on ending the violence were "very close" and Kiev and the rebels could reach an agreement by Friday, much-needed respite for the Ukrainian leader battling a crumbling economy.

But hopes of peace were clouded by Western concerns that the announcement was timed by the Kremlin to wrong-foot NATO on the eve of a summit that will discuss the crisis and to sow doubt in the European Union over imposing new sanctions against Moscow.

US President Barack Obama said a ceasefire would succeed only if Moscow stopped sending troops to Ukraine.

New shelling of the rebel stronghold of Donetsk, sending plumes of grey smoke from near the city's airport, also undermined confidence in an end to hostilities. "The parties reached mutual understanding on the steps that will facilitate the establishment of peace," Poroshenko's office said, amending an earlier statement that had spoken of agreement on a "permanent ceasefire".

Kremlin spokesman Dmitry Peskov said the leaders agreed on steps towards peace but not a ceasefire because Russia was not a party to the conflict, which has killed more than 2,600 people since April and caused the worst crisis in relations between Russia and the West since the Cold War.

Putin sounded upbeat in comments to reporters during a visit to Mongolia. "Our views on the way to resolve the conflict, as it seemed to me, are very close," he said, outlining the seven steps he had put forward to secure a resolution to the crisis.

These steps, he suggested, should include a prisoner exchange and the creation of a humanitarian corridor for refugees and aid supplies. He called for Ukrainian troops to pull back and for rebels to cease offensive operations.

The West accuses Russia of arming the rebels and sending troops into Ukraine to turn the tide of fighting in the almost five month-old conflict.

Moscow denies the charges.

"We have consistently supported the effort of president (Petro) Poroshenko of achieving a meaningful ceasefire that could lead to a political settlement," Obama said in the Estonian capital, Tallinn, during a visit intended to underline US commitment to a frontline NATO state.

"So far it hasn't helped, either because Russia has not been serious about it or it's pretended that it's not controlling the separatists, and separatists, when they thought it was to their advantage, have not abided by the ceasefire."

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