BRUSSELS, BELGIUM (MARCH 20, 2014) (REUTERS) - European leaders will agree to expand a list of those subject to travel bans and asset freezes on Thursday (March 20) but stop short of harder-hitting measures againstRussia over Crimea, biding their time to retain European Union (EU) unity and gaugeMoscow's reaction.
While agreeing to expand the list to include figures closer to Russian President Vladimir Putin would be a step forward, it is a long way short of the powerful financial and trade sanctions diplomats and analysts say are needed to make Moscow pay attention.
"Pressure is necessary if there is to be discussion and negotiation. And that is why economical sanctions, even if they are not decided today, need to be considered, need to be in any case, prepared. As for today's and tomorrow's European Council meeting, individual sanctions need to be stated," he told reporters when he arrived at the two-day summit.
Britain's David Cameron confirmed names would be added to the asset-freeze and travel-ban list, but did not say how many. Any decision would not become law until it is published in coming days.
"This is an important council because what Russia has done is unacceptable and the countries of the European Union need to speak with a clear and united voice. What that means is more asset freezes and travel bans, more actions specifically in respect of what's happened in the Crimea, but also it means making sure that we do everything we can to help build a strong and democratic Ukraine and one of the things we must do at this council is sign a new agreement with the Ukraine offering them a prosperous future, access to our markets and real political support. That's what we need to do," Cameron said.
German Chancellor Angela Merkel echoed Hollande's sentiments and said a discussion of financial sanctions - what the EU refers to as phase three of its response - would take place at the summit, but no agreement on imposing the measures is expected.
"We will, once again, make clear that the annexation of Crimea is against all international treaties and we will deal with our response to it. We always say that firstly there should be talks, there are discussions with the OECD states which I think are important so that an observers' mission can quickly go to Ukraine and secondly, we will deal with sanctions, an extension to the so called second phase - that is extensions of visa bans and asset freezes and we will make it very clear that should it come to further escalations, we are prepared to enforce trade sanctions," Merkel said.
Russian forces took control of the Black Sea peninsula in late February, after the toppling of former Ukrainian president Viktor Yanukovich. Moscow-backed Yanukovich fled following months of protests spurred by his decision to reject closer trade and political ties with the EU and pivot to Moscow.
Germany, Britain, France, Poland and one or two other countries largely agree about the need to respond vigourously to Russia, potentially including some measure of financial sanctions, but most of the rest have severe reservations.
Leaders will also discuss ways to diversify their supplies, potentially including more wind and solar power, shale-gas exploration and imports of liquefied natural gas from the United States and Middle East.
The EU faces a geopolitical challenge in trying to move away from its dependence on Russian energy.