(Updates with government troops advancing from second paragraph. See EXT2 for more on the Ukraine crisis.)
June 3 (Bloomberg) -- Ukraine said it’s deploying heavy weaponry and armored vehicles to strengthen its border with Russia and halt an influx of fighters after skirmishes with separatists claimed another dozen lives.
Government troops are starting to close the border with Russia in the easternmost Luhansk region, after driving the biggest rebel groups out of the northern part of neighboring Donetsk, acting President Oleksandr Turchynov said in a statement. Authorities are also moving personnel and equipment to the southwestern frontier with Transnistria, the breakaway Moldovan region where hundreds of Russian troops are stationed, according to State Border Service chief Mykola Lytvyn.
“A large number of terrorists” were “liquidated” in Luhansk, Turchynov told lawmakers in Kiev. The operation around Slovyansk in Donestk is “in an active offensive phase” with “very active exchanges of fire,” Interior Minister Arsen Avakov said on Facebook. Two soldiers were killed and 42 wounded today in firefights with insurgents, who also downed two helicopters, Vladyslav Seleznyov, a government spokesman, said by phone. The crews survived.
The bloodshed in the mainly Russian-speaking regions underscored the tension with Russia as President Barack Obama began a European tour with talks in Ukraine’s western neighbor Poland. He’ll meet Ukrainian President-elect Petro Poroshenko tomorrow to discuss the crisis. The U.S. and the European Union say Russia, which annexed Crimea from Ukraine in March, is behind the unrest, a charge President Vladimir Putin denies.
The U.S. and the EU have imposed sanctions on dozens of Russian individuals and companies close to Putin as punishment for his annexation of Crimea.
“Further Russian provocation will be met with further cost for Russia,” Obama said at a news conference in Warsaw today with Polish President Bronislaw Komorowski. He called on Putin to meet Poroshenko and to “engage constructively.”
Obama said Putin needs to use his influence with the insurgents to convince them to stop attacking Ukrainian forces, abandon seized buildings and lay down arms. The two leaders will cross paths this week in Paris and during 70th-anniversary commemorations of the allied landings in northern France during World War II.
Putin said during a meeting today with his human rights ombudsman, Ella Pamfilova, that he supports the creation of a “humanitarian corridor” to allow Russian aid to reach people in Ukraine affected by the fighting.
“I’m just amazed” that the “enlightened western world suddenly became deaf, dumb and blind all at once” to the tragedy unfolding in Ukraine, Pamfilova told Putin in Sochi.
The Micex stock index advanced 0.6 percent in Moscow to 1.472.83, the most in three months. That extended a 2.3 percent gain yesterday after Russia gave Ukraine an extra week to pay in advance for gas supplies before risking a cutoff that could also lead to shortages in Europe.
Russian Energy Minister Alexander Novak said EU-brokered talks over gas prices with Ukraine in Brussels yesterday were “constructive.”
Even so, a shutdown in supplies is “still on the agenda,” Ukrainian Prime Minister Arseniy Yatsenyuk told lawmakers in Kiev. Talks between Russian gas exporter OAO Gazprom and NAK Naftogaz Ukrainy, Ukraine’s state-run gas company, were continuing today in Berlin and the aim is to reach agreement this week, he said.
Ukraine carries about 15 percent of the natural gas used by Europe through its Soviet-era pipelines and accuses Russia of using energy as a political weapon by ramping up prices.
One Ukrainian serviceman was killed and 13 wounded when separatists attacked their convoy traveling to Slovyansk earlier today, according to Seleznyov, the government spokesman.
At least 12 deaths were reported in Luhansk yesterday after about 500 insurgents attacked the border-guard headquarters. Five rebels died in that assault, the border guards said, and a blast in the center of the city killed seven people, according to the local health service.
A total of 181 people have been killed since unrest broke out in eastern Ukraine, Prosecutor General Oleh Makhnitsky said in Kiev. The death toll includes 59 servicemen, including a general who was in a copter shot down by insurgents on May 29. Another 293 people have been wounded and 220 kidnapped, he said.
In Warsaw, Obama announced a $1 billion fund to bolster military training and assistance for NATO allies near Russia. More equipment will be positioned in Europe. The U.S. also will strengthen partnerships with allies such as Ukraine, Moldova and Georgia that aren’t part of the alliance, he said.
“The ability for people to make their own determination about their country’s future is the cornerstone of the peace and security that we’ve seen over the last several decades,” Obama said. “That is threatened by Russian actions in Crimea and now Russian activity in eastern Ukraine.”
North Atlantic Treaty Organization defense ministers were set to discuss Ukraine during two days of talks in Brussels that started today.
“There are still tens of thousands of Russian troops along the Ukrainian borders and that massive troop presence is not justified,” NATO Secretary General Anders Fogh Rasmussen told reporters before the meeting. He called on Russia to “de- escalate the situation, first and foremost by a full withdrawal.”
Meanwhile, Ukrainian Justice Minister Pavlo Petrenko proposed confiscating Russian companies’ assets in Ukraine and abroad to compensate for losses of about $90 billion resulting from the annexation of Crimea.
Obama’s trip offers a series of venues for possible talks on the Ukraine conflict. He’ll meet other Group of Seven leaders in Brussels starting tomorrow, though they won’t decide on further steps to sanction Russia during the talks, according to a German official speaking to reporters today on condition of anonymity.
The U.S. president will also attend a dinner with Francois Hollande June 5, the same day the French president hosts Putin, before they travel on to the D-Day commemorations in Normandy on June 6.
Vice President Joe Biden will travel to Ukraine for Poroshenko’s inauguration on June 7, the White House said yesterday.
--With assistance from Ilya Khrennikov in Moscow, Tony Czuczka in Berlin, James G. Neuger in Brussels, Kateryna Choursina and Daryna Krasnolutska in Kiev and Margaret Talev in Warsaw.