Russian president has reportedly ordered troops taking part in exercises to return to base.
Russian President Vladimir Putin insisted Tuesday that he can use as much force as necessary to protect Russians in Ukraine while the United States and Europe appealed for a diplomatic solution to the crisis.
Putin offered his first public remarks since Russian military moved into Crimea following the ouster of pro-Moscow president Viktor Yanukovych. He declared that Western actions were driving Ukraine into anarchy and warned that any sanctions the West might place on Russia will not work.
"Neo-Nazis and anti-Semites are rampant in Ukraine and particularly in Kiev (and) people in eastern Russia are worried," Putin said.
Putin said he had no intention of moving Russian troops further into Ukraine as U.S. Secretary of State John Kerry condemned Russian "acts of aggression" and said the Kremlin was "hiding its hand behind falsehoods, intimidation and provocation."
The dueling claims came on a day when pro-Russian Ukrainian troops in Crimea fired warning shots into the air to scare off several hundred Ukrainian soldiers approaching an air base.
Kerry, who was in Kiev, said that if Russia had legitimate concerns about the treatment of Russian-speaking citizens in Ukraine there are "countless" international organizations Moscow could turn to.
"There are way to resolve these things," he said. "Great nations choose to do that appropriately."
Kerry toured Independence Square — also known as the Maidan — to lay flowers for those killed by troops under the authority of Yanukovych. Envoys from the Organization for Security and Cooperation in Europe were arriving, hoping to talk to the self-proclaimed local authorities in Crimea, spokeswoman Cathie Burton said.
Putin said in Moscow that there is not yet a need for him to send troops into the rest of Ukraine from Crimea, where Russian military and Ukrainians loyal to Moscow have taken over border crossings, airfields and military bases. He accused the West of encouraging an "unconstitutional coup."
Crimea, which is in the southern part of Ukraine on the Black Sea, has declared that it wants independence from the central government in Kiev and many but not all Crimeans welcomed Russia's incursion. Kiev insists that Crimea remain part of Ukraine and that Russia end its "illegal invasion" of its sovereignty.
Global markets were calm. Russian markets were up 5% and markets across Europe were higher on Tuesday.
Putin reiterated that Yanukovych is the legitimate leader of Ukraine and that his removal by the country's parliament was an "anti-constitutional coup and armed seizure of power." Putin said the parliament in Ukraine is "partly legitimate" but that the country's acting president is not.
Yanukovych was removed last month by a vote of the parliament that included members of his own party for doing nothing to stop the killing of more than 80 protesters in downtown Kiev. A new president was named and new elections scheduled.
Protesters want closer ties to Europe and not Moscow. Yanukovych had signed a trade deal with Moscow at Putin's urging that hinged on Ukraine refusing to sign a pact with Europe, which infuriated the protest movement.
"Putin may say what he wants about our government – Europe recognized it and it is to Europe that we aim to be moving toward, not Russia," said Roman Kovalenko, 26, in Kiev.
"Ukraine is already working under the new government and there is nothing he (Putin) can do about it –unless, of course, he starts a real war. I hope he won't," he said. "Putin's main problem is not Crimea – he has a problem with our revolution and the 'bad example' that Ukraine showed to the people of Russia."
The USA and the 28-nation European Union have raised the possibility of sanctions against Russia. Putin's Foreign Ministry said many nations would not go along with sanctions.
Washington said it planned to offer $1 billion in energy subsidies to Ukraine to help the country through a financial crisis. Ukraine's finance ministry says the country needs $35 billion to get through this year and next.
In a related development, NATO and Russia agreed to meet over Russia's intervention in the Ukrainian province of Crimea.
Anders Fogh Rasmussen, secretary-general of the U.S.-European military alliance, said an extraordinary NATO-Russia council will convene this week.
The Russian move in Crimea and the ouster of Yanukovych has sparked riots and fights in several cities in Ukraine where there is a significant population of ethnic Russians. Crimea declared independence from Russia's predecessor, the Soviet Union, in 1991.
Putin said that he is not considering the annexation of Crimea into Russia proper and said he only took in Yanukovych because, "He would have been killed in Ukraine had we not helped him."
Yanukovych fled Kiev and surfaced in Russia last week after Kiev issued an arrest warrant accusing him of stealing millions of dollars from the Ukraine treasury and of complicity in the murder of peaceful protesters.
Earlier, the Interfax and RIA-Novosti news agencies, attributing their information to Dmitry Peskov, Putin's spokesman, reported that Putin had ordered Russian troops staging training exercises on the nation's western flank to return to their barracks.
No mention was made in the statement of the estimated 16,000 Russian troops thought to be in Crimea.
The shooting at Belbek air base appeared to be over as soon as it happened, according to reporters on the scene. Pro-Russian troops blocking the airbase fired warning shots as the roughly 300 Ukrainian soldiers who previously manned the airfield arrived and demanded their jobs back, the Associated Press and others reported.
The shots were the first ones fired since Russia and its loyalists took over Crimea. They came a day after a Russian admiral issued an alleged ultimatum to Ukraine's military in Crimea to surrender at dawn Tuesday. The Russian Defense Ministry later called the demand "nonsense" but did not explain further.
Meanwhile, the USA and Europe appear to be trying to decide how to handle the crisis. No sanctions have been announced, and both ruled out military measures.
The Pentagon halted all military cooperation with Russia, including exercises and meetings, Rear Adm. John Kirby said. U.S. Trade Representative Michael Froman's office said it suspended upcoming bilateral trade and investment talks with Russia.
"Due to recent events in Ukraine, we have suspended upcoming bilateral trade and investment engagement with the Government of Russia that were part of a move toward deeper commercial and trade ties," Froman's office said in a statement.
In Washington, the White House said in a statement regarding an energy and economic aid package that it was working with allies "to develop an assistance package that will provide rapid financial and technical assistance to help Ukraine restore economic stability and conduct free, fair and inclusive new elections that will allow the Ukrainian people to continue to make democratic choices about their future."
In remarks on Monday at the White House, President Obama said Russia is "on the wrong side of history'' by intervening in Ukraine.
"Over time this will be a costly proposition for Russia, and now's the time for them to consider whether they can serve their interests in a way that resorts to diplomacy as opposed to force," Obama said from the Oval Office.
An unnamed Kremlin aide said that if the U.S. were to impose sanctions, Moscow may be forced to drop the dollar as a reserve currency, Reuters reported. Russia also reversed an earlier decision to lift a ban on pork imports from the USA, saying the existing U.S. system of checks don't guarantee its safety. Russia's leading natural-gas producer Gazprom said that it would remove Ukraine's heavily discounted gas prices from April.