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Obama Warns New Economic Sanctions Against Russia ‘Could Be Disruptive To Global Economy’

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President Barack Obama speaks on the South Lawn of the White House to deliver a statement on Ukraine prior to departing for Florida on March 20, 2014 in Washington, DC. (credit: Win McNamee/Getty Images)

President Barack Obama speaks on the South Lawn of the White House to deliver a statement on Ukraine prior to departing for Florida on March 20, 2014 in Washington, DC. (credit: Win McNamee/Getty Images)

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WASHINGTON (CBS News/CBSDC/AP) — President Barack Obama announced Thursday new sanctions against Russian officials who provide material support to Russia’s government.

Obama also signed an executive order that allows the U.S. to impose sanctions on sectors of the Russian economy.

“We are imposing more sanctions on more senior officials of the Russian government,” Obama said before departing the White House for Florida.

Obama warned that these sanctions will have a “significant impact on the Russian economy but could also be disruptive to the global economy.”

The president still believes that diplomatic solution is still available to end the Russia-Ukraine crisis.

“Diplomacy between the United States and Russia continues,” Obama said. “We’ve emphasized that Russia still has a different path available.”

In his statement, Obama told Russian President Vladimir Putin that “Ukrainians shouldn’t have to choose between the West and Russia.”

“We want the Ukrainian people to chose their own destiny,” Obama said. “That can only happen if Russia also recognizes the rights of the Ukrainian people.”

The new penalties mark the second round of economic sanctions the U.S. has levied on Russia this week. The first round of penalties had little impact in stopping Moscow from annexing the strategically important Crimean Peninsula from Ukraine.

In an address to the German Parliament in Berlin, Chancellor Angela Merkel said the European Union was readying further sanctions and that the G-8 forum of leading economies had been suspended indefinitely. Russia holds the presidency of the G-8 and Putin was due to host his counterparts, including Obama, at a summit in Sochi in June.

“So long as there aren’t the political circumstances, like now, for an important format like the G-8, then there is no G-8,” Merkel said. “Neither the summit, nor the format.”

Russian forces effectively took control of Crimea some two weeks ago in the wake of the ouster of Ukraine’s pro-Russia president, Viktor Yanukovych, after months of protests and sporadic violence. The crisis erupted late last year after Yanukovych backed out of an association deal with the EU in favor of a promised $15 billion bailout from Russia. That angered Ukrainians from pro-European central and western regions.

CBS News reports that 20,000 Russian troops are positioned on the other side of the eastern Ukrainian border and that the troops “are poised and ready to go.”

CBS News’ Elizabeth Palmer reported from the Crimean capital of Sevastopol, however, that the combined pressure from the U.S. and Europe does not appear to be slowing down Russia’s rush to annex the Black Sea peninsula.

The final formalities were expected to be ratified by the Russian Parliament on Thursday and Friday, meaning the annexation of Crimea will likely be a done deal by the weekend.

Merkel said EU leaders would increase those “level 2″ sanctions against Russia when they meet later Thursday in Brussels to widen the list of those whose assets are being frozen and who are banned from traveling.

She also reiterated that if things worsen, the EU is prepared to move to “level 3″ measures, which would include economic sanctions.

“The European Council will make it clear today and tomorrow that with a further deterioration of the situation we are always prepared to take level 3 measures, and those will without a doubt include economic sanctions,” she said.

Merkel’s tough approach came as the commander of Ukraine’s navy was freed after being held by Russian forces and local Crimean militia at the navy’s headquarters.

Rear Adm. Sergei Haiduk and an unspecified number of civilians were held for hours after the navy’s base in Sevastopol was stormedWednesday. Early reports said the storming was conducted by a self-described local defense force, but Thursday’s statement by acting President Oleksandr Turchynov, which confirmed the release, said Russian forces were involved.

Palmer reported that thousands of Ukrainian soldiers are still stranded at their posts, on bases and naval vessels all over Crimea, and they’re hoping to avoid the humiliation of being driven out by their new and unexpected enemy, the Russians, with their possessions and their families.

Right now, as their new government in Kiev tries to figure out how to accomplish that, they have nothing to look forward to but uncertainty.

Attempting to face down the unblinking incursion, Ukraine on Wednesday said it would hold joint military exercises with the United States and Britain, signatories, along with Russia, of the 1994 Budapest Memorandum – a document designed to guarantee Ukraine’s territorial integrity when it surrendered its share of Soviet nuclear arsenals to Russia after the Soviet Union broke up in 1991.

Just how many retreating troops Ukraine will have to absorb in what amounts to a military surrender of Crimea was unclear. Many servicemen have already switched sides to Russia, but authorities said they were prepared to relocate as many as 25,000 soldiers and their families to the Ukrainian mainland.

With thousands of Ukrainian soldiers and sailors trapped on military bases, surrounded by heavily armed Russian forces and pro-Russia militia, the Kiev government said it was drawing up plans to evacuate its outnumbered troops from Crimea back to the mainland and would seek U.N. support to turn the peninsula into a demilitarized zone.

Humbled but defiant, Ukraine lashed out symbolically at Russia by declaring its intent to leave the Moscow-dominated Commonwealth of Independent States, a loose alliance of 11 former Soviet nations. The last nation to leave the group was Georgia, which fought a brief war with neighboring Russia in 2008 and ended up losing two separatist territories.

UN Secretary-General Ban Ki-moon is visiting Moscow on Thursday and is to come to Ukraine on Friday.

“We are working out a plan of action so that we can transfer not just servicemen, but first of all, members of their family who are in Crimea, quickly and effectively to mainland Ukraine,” said Andriy Parubiy, secretary of Ukraine’s National Security and Defense Council.

(TM and © Copyright 2014 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2014 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

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