MOSCOW: Russian President Vladimir Putin on Wednesday unveiled a broad peace plan for Ukraine that could be agreed by the weekend to end a bloody pro-Kremlin uprising that has all but severed East-West ties.
The surprise announcement could take the wind out of the sails of a high-stakes NATO summit on Thursday where Western leaders led by US President Barack Obama plan to step up their defence of eastern Europe in the face of Russian "aggression".
Putin appealed for both sides to lay down their weapons after nearly five months of fighting that has killed 2,600 people and been blamed by both Kiev and its Western allies on Putin's attempts to seize back former Soviet and tsarist lands.
The sudden glimmer of hope for an imminent end to Europe's worst crisis in at least two decades saw stocks in key markets rise and the Russian ruble rebound.
But there were early signs that the blueprint which Ukrainian President Petro Poroshenko said was agreed during telephone talks between the two leaders lacked universal support.
Ukrainian Prime Minister Arseniy Yatsenyuk said Putin's proposal was meant to "pull the wool over the eyes of the international community".
And Obama preferred to sound extreme caution during a highly symbolic visit to former Soviet republic and new NATO member Estonia -- one of many eastern European nations watching Putin's seeming efforts to seize back old holdings with growing concern.
"It's too early to tell what the ceasefire means," said Obama. "There is an opportunity here. Let's see if there is a follow up".
The resurgent rebels may also take some convincing to lay down their weapons after scoring a resounding string of successes with the alleged support of Russian soldiers that has seen Ukrainian forces lose effective control over most of the separatist east.
"A ceasefire does not mean a peace agreement," Donetsk rebel leader Andrei Purgin told Russia's Interfax news agency. "If Kiev unilaterally ceases fire, we will be forced to do the same."
Poroshenko had insisted since his May election that he could crush the rebellion a mission that seemed on the verge of being completed until NATO reported seeing more than 1,000 crack Russian soldiers flood across the Ukrainian borders with heavy weapons last week.
The Kremlin accuses NATO of concocting the evidence in order to expand its own presence along Russia's western border.
Putin's message seemed partially calculated at taking the sting out of the NATO meeting opening in Wales at which Western leaders were meant to unveil a new rapid response force for eastern Europe that Moscow has branded a direct national security threat.
Obama said NATO must send an "unmistakable message of support" to Ukraine in turmoil since the February ouster of a Kremlin-backed president by pro-Western protesters.
Ukraine will also host 200 US soldiers for September 13-26 military drills involving several NATO countries that are aimed at showing the degree to which Kiev is determined to break its dependence on its former Soviet masters.
The Kremlin denies giving anything more than moral support to the insurgents who launched their uprising against Kiev's new Western-backed leaders in April.
But Western powers say Moscow has been orchestrating the insurrection as part of a land grab that started with its annexation of Ukraine's strategic Crimea peninsula in March.
Poroshenko said the seven-point blueprint was agreed during a phone exchange between the two leaders that appeared to underscore Putin's influence in a conflict in which he denies playing any role.
The first point announced by Putin demands an end to "active offensive operations by the (Ukrainian) armed forces and armed rebel units in the southeast of Ukraine".
It also invites international monitors to watch over parts of the border controlled by insurgents and allegedly used to smuggle in Russian weapons and more recently highly-trained paramilitary troops.
Putin said he expected a final agreement to be announced by the insurgents and Kiev representatives during European-mediated negotiations on Friday in the Belarussian capital Minsk.
Western leaders have learned to their chagrin that they have few actual options in helping Ukraine.
Obama has ruled out direct military intervention and economic sanctions imposed on Russia have yet to show any sign of changing the Kremlin's hawkish ways despite hitting the economy hard.
Diplomatic sources said European nations are now discussing a British-backed plan to boycott Putin's showpiece 2018 football World Cup.
Paris also won praise from Obama for reversing its earlier position and suspending the delivery of the first of two modern helicopter carriers to Russia that Putin had planned to station in Crimea.
French President Francois Hollande said he made his decision after concluding that Russia's actions in Ukraine "go against the foundations of Europe's security". Sources said France will review the decision in November.
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