It was Putin's first comments since Ukrainian President Viktor Yanukovych fled Kiev last month and landed in Russia. Ukraine's new government wants to put him on trial for the deaths of over 80 people during protests in Kiev.
Tensions remained high Tuesday in the strategic Ukrainian peninsula of Crimea, with troops loyal to Moscow firing warning shots to ward off protesting Ukrainian soldiers. U.S. Secretary of State John Kerry was en route to Kiev, where Ukraine's new government is based.
Yet world markets seemed to recover from their fright over the situation in Ukraine, clawing back a large chunk of Monday's stock losses, while oil, gold, wheat and the Japanese yen have given back some of their gains.
"Confidence in equity markets has been restored as the standoff between Ukraine and Russia is no longer on red alert," said David Madden, market analyst at IG.
Speaking from his residence outside Moscow, Putin said he considers Yanukovych to still be Ukraine's leader and hopes that Russia won't need to use force in predominantly Russian-speaking eastern Ukraine.
He did say, however, that Yanukovych has no political future and Russia gave him shelter only to save his life.
Putin accused the West of using Yanukovych's decision in November to ditch a pact with the 28-nation European Union in favor of closer ties with Russia to encourage the months of protests that drove him from power.
Earlier Tuesday, the Kremlin said Putin had ordered tens of thousands of Russian troops participating in military exercises near Ukraine's border to return to their bases. The massive military exercise in western Russia involving 150,000 troops, hundreds of tanks and dozens of aircraft was supposed to wrap up anyway, so it was not clear if Putin's move was an attempt to heed the West's call to de-escalate the crisis that has put Ukraine's future on the line.
It came as Kerry was on his way to Kiev to meet with the new Ukrainian leadership that deposed the pro-Russian Yanukovych and has accused Moscow of a military invasion in Crimea. The Kremlin, which does not recognize the new Ukrainian leadership, insists it made the move in order to protect Russian installations in Ukraine and its citizens living there.
On Tuesday, Russian troops who had taken control of the Belbek air base in the hotly contests Crimea region fired warning shots into the air as around 300 Ukrainian soldiers, who previously manned the airfield, demanded their jobs back.
About a dozen Russian soldiers at the base warned the Ukrainians, who were marching unarmed, not to approach. They fired several warning shots into the air and said they would shoot the Ukrainians if they continued to march toward them.
The shots reflected tensions running high in the Black Sea peninsula since Russian troops - estimated by Ukrainian authorities to be 16,000 strong -tightened their grip over the weekend on the Crimean peninsula, where Moscow's Black Sea Fleet is based.
Ukraine has accused Russia of violating a bilateral agreement on conditions of a Russian lease of a naval base in Crimea that restricts troop movements, but Russia has argued that it was acting within the limits set by the deal.
Russia's ambassador to the United Nations, Vitaly Churkin, said Monday at the U.N. Security Council that Russia was entitled to deploy up to 25,000 troops in Crimea under the agreement. Churkin didn't specify how many Russian troops are now stationed in Crimea, but said that "they are acting in a way they consider necessary to protect their facilities and prevent extremist actions."
Churkin said Russia wasn't trying to ensure the return to power of Yanukovych, but still considers him the legitimate leader of Ukraine and demands the implementation of a Western-sponsored peace deal he signed with the opposition that set presidential elections for December. Russian envoy at those talks did not sign the deal. Yanukovych fled the capital hours after the deal was signed and ended up in Russia, and the Ukrainian parliament set the presidential vote for May 25.
In Crimea, a supposed Russian ultimatum for two Ukrainian warships to surrender or be seized passed without action from either side, as the two ships remained anchored in the Crimean port of Sevastopol. Russian Defense Ministry spokesman Vladimir Anikin said late Monday that no ultimatum had been issued.
The maneuvers, which Putin ordered last Wednesday, involved scrambling fighter jets to patrol Russia's western frontiers and stoked fears that the Kremlin might send troops into Russian-speaking regions in eastern Ukraine.
In Brussels, meanwhile, the ambassadors of NATO's 28 member nations will hold a second emergency meeting on Ukraine on Tuesday after Poland, which borders both Russia and Ukraine, invoked an article calling for consultations when a nation sees its "territorial integrity, political independence or security threatened."
President Barack Obama has said that Russia is "on the wrong side of history" in Ukraine and its actions violate international law. Obama said the U.S. was considering economic and diplomatic options that will isolate Russia, and called on Congress to work on an aid package for Ukraine.
In return, Russia's agricultural oversight agency issued a statement Tuesday declaring the reversal of its earlier decision to lift the ban on imports of U.S. pork. It said the existing U.S. system of checks don't guarantee its safety.
Putin's economic advisor, Sergei Glazyev, said that Russia can develop financial ties with other nations to offset any potential Western sanctions.
The European Union's foreign ministers on Monday threatened Moscow with halting talks on visa liberalization and negotiations on further economic cooperation unless Russian troops on the Crimean peninsula pull back over the next three days.
The bloc's 28 heads of state and government will hold an emergency meeting on the situation in Ukraine on Thursday that will decide on imposing the sanctions if there is no de-escalation on the ground.
US prepares $1B aid package for troubled Ukraine
KIEV, Ukraine (AP) - In a somber show of U.S. support for Ukraine's new leadership, Secretary of State John Kerry walked the streets Tuesday where nearly 100 anti-government protesters were gunned down by police last month, and promised beseeching crowds that American aid is on the way.
The Obama administration announced a $1 billion energy subsidy package in Washington as Kerry was arriving in Kiev. The fast-moving developments came as the United States readied economic sanctions amid worries that Moscow was ready to stretch its military reach further into the mainland of the former Soviet republic.
Kerry headed straight to Institutska Street at the start of an hours-long visit intended to bolster the new government that took over just a week ago when Ukraine President Viktor Yanukovych fled. He lay a bouquet of red roses, and twice the Roman Catholic secretary of state made the sign of the cross at a shrine set up to memorialize protesters who were killed during mid-February riots.
"We're concerned very much. We hope for your help, we hope for your assistance," a woman shouted as Kerry walked down a misty street lined with tires, plywood, barbed wire and other remnants of the barricades that protesters had stood up to try to keep Yanukovych's forces from reaching nearby Maidain Square, the heart of the demonstrations.
Piles of flowers brought in honor of the dead provided splashes of color in an otherwise drab day that was still tinged with the smell of smoke.
"We will be helping," Kerry said. "We are helping. President Obama is planning more assistance."
The Ukraine government continued to grapple with a Russian military takeover of Crimea, a strategic, mostly pro-Russian region in the country's southeast, and Kerry's visit came as Russian President Vladimir Putin said he wouldn't be deterred by economic sanctions imposed punitively by the West.
U.S. officials traveling with Kerry, speaking on condition of anonymity, said the Obama administration is considering slapping Russia with unspecified economic sanctions as soon as this week. Members of Congress say they're preparing legislation that would impose sanctions as well.
As Kerry arrived, the White House announced the package of energy aid, along with training for financial and election institutions and anti- corruption efforts. Additionally, the officials said, the U.S. has suspended what was described as a narrow set of discussions with Russia over a bilateral trade investment treaty. It is also going to provide technical advice to the Ukraine government about its trade rights with Russia. The officials spoke on condition of anonymity because they were not authorized to be quoted by name before the official announcement was made.
Putin pulled his forces back from the Ukrainian border on Tuesday, yet said that Moscow reserves the right to use all means to protect Russians in the country. He accused the West of encouraging an "unconstitutional coup" in Ukraine and driving it onto anarchy, declaring that any sanctions the West places on Russia will backfire.
Speaking from his residence outside Moscow, Putin said he still considers Yanukovych to be Ukraine's leader and hopes Russia won't need to use force in predominantly Russian-speaking eastern Ukraine.
In Washington, the White House said the $1 billion loan guarantee was aimed at helping insulate Ukraine from reductions in energy subsidies. Russia provides a substantial portion of Ukraine's natural gas and U.S. officials said they are prepared to work with Kiev to reduce its dependence on those imports. The assistance is also meant to supplement a broader aid package from the International Monetary Fund.
Clutching five red carnations, Svitlana Moherouska, an 18-year-old student at Kiev National University, said Ukraine desperately needs economic aid to ensure its people continue to collect salaries. She said joined in the protests, starting last November.
"We come here to leave flowers and to walk the streets where there was a war," she said. "It's very painful for us. It was hard for me to see how the police ran after our people. I hope it will be our victory and be a better life for us. But it will be very hard for us because the economy is very bad."
The U.S. officials traveling to Kiev said Washington is warily watching to see whether Russia will try to advance beyond Crimea.
They cited reports of Russian helicopters nearly flying into mainland Ukraine airspace before being intercepted by jets controlled by Kiev. It's believed as many as 16,000 Russian troops have deployed to Crimea, while Ukrainian forces are amassing on both sides of an isthmus separating the region's peninsula from the mainland.
Ivan Sekretarev in Sevastopol and Vladimir Isachenkov in Moscow contributed to this report.