Putin Agrees on Steps for Ukraine Cease-Fire With Poroshenko

Sep 03, 2014 6:25 am ET

(Updates with Poroshenko in first paragraph, Obama in seventh. For more on the conflict in Ukraine, see EXT2.)

Sept. 3 (Bloomberg) -- Russian President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko agreed on steps toward a cease-fire in Ukraine’s easternmost regions, where a bloody conflict has raged for more than five months.

Putin backs the idea of an immediate truce, his spokesman Dmitry Peskov said in Ulan Bator, Mongolia. He denied Poroshenko’s earlier assertion that the leaders agreed on a permanent cease-fire, saying Russia can’t reach such an accord as it’s not part of the conflict. The Ukrainian president’s office deleted the word “constant” from its statement.

“The conversation resulted in an agreement on cease-fire regime in the Donbas,” Poroshenko said in the altered statement on its website, referring to the region of the unrest. “The parties reached mutual understanding on the steps that will facilitate the establishment of peace.”

Ukraine, the U.S. and Europe accuse Russia of dispatching soldiers and backing pro-Russian rebels in fighting that the United Nations estimates has cost at least 2,600 lives. Russia, which is facing further sanctions as early as this week over the unrest, has repeatedly denied involvement. There were no other details about the conversation between the two leaders. Pro- Russian rebels said Poroshenko didn’t agree to a cease-fire with them, RIA Novosti reported.

‘Putin’s Psychology’

U.S. President Barack Obama, in Estonia today to reassure eastern European NATO members of their security before heading to this week’s alliance summit in the U.K., expressed skepticism over the announcement.

“We haven’t seen a lot of follow-up on so-called announced cease-fires,” Obama told reporters in the Estonian capital, Tallinn. “If in fact Russia is prepared to stop financing army training” and “is serious about a political settlement, that is something we are hopeful for. I’ll leave it up to others to interpret Mr. Putin’s psychology on this.”

Emerging-market stocks headed for a three-year high and the ruble led gains in currencies on optimism the conflict in eastern Ukraine will ease. The Micex Index climbed 2.7 percent and the ruble ended a six-day rout. The ruble strengthened after finishing yesterday at its lowest level since at least 2003.

--With assistance from Jones Hayden and James G. Neuger in Brussels, Ekaterina Shatalova, Scott Rose, Henry Meyer and Olga Tanas in Moscow, Kateryna Choursina in Kiev and Ott Ummelas and Phil Mattingly in Tallinn, Estonia.