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imageBASEL: The Ukraine crisis was to take centre stage Thursday at a meeting of top diplomats from OSCE nations after US President Barack Obama said Moscow was unlikely to shift its stance until sanctions really hurt.

Europe's top diplomat Federica Mogherini called for a "strong political signal" on the crisis that has resisted multiple peace efforts and plunged East-West relations to their lowest point since the end of the Cold War.

She was speaking ahead of a meeting with Russian Foreign Minister Sergei Lavrov, who will also hold talks with US Secretary of State John Kerry on the sidelines of the two-day meeting in the northern Swiss city of Basel.

The 57-member Organisation for Security and Cooperation in Europe is charged with monitoring a shattered ceasefire between the Ukrainian army and separatist Moscow-backed rebels in eastern Ukraine reached on September 5.

However efforts to reach a lasting peace in the eight-month conflict have so far proven futile.

The overall ceasefire has failed to fully stop fighting in a conflict that has left some 4,300 people dead, and a long-awaited local truce around the flashpoint Donetsk airport appeared to crumble Wednesday just hours after it was signed.

"It is not a Ukrainian crisis, it is not an OSCE crisis, it is about Russian aggression," said Ukrainian Foreign Minister Pavlo Klimkin as he arrived at the talks.

The threat of further economic sanctions hung over Russia, already facing recession, for its support of separatist rebels in eastern Ukraine.

A European source said Mogherini's bilateral talks with Lavrov would focus on a wide range of issues, including Ukraine and Russia's thorny relations with the EU.

"Energy topics" will also come under the spotlight, the source said, after Putin unexpectedly shelved the multi-billion-dollar South Stream gas pipeline, which would have bypassed Ukraine to deliver Russian gas directly to southeast Europe.

On Friday the OSCE talks will focus on the issues of terrorism and foreign fighters.

The start of the two-day OSCE meeting coincides with Russian President Vladimir Putin's annual address to parliament.

Speaking in Washington, Obama said sanctions were "having a big bite" on Russia's economy.

"If you asked me, am I optimistic that Putin suddenly changes his mindset, I don't think that will happen until the politics inside of Russia catch up to what's happening in the economy inside of Russia, which is part of the reason why we're going to continue to maintain that pressure," Obama said.

Kerry was set to meet Lavrov to "discuss a range of topics of mutual interest including issues related to the Middle East", according to a US official.

Copyright AFP (Agence France-Presse), 2014

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