Obama Says Russia Not Abiding by Geneva Agreement on Ukraine

President Barack Obama said Thursday Russia was not abiding by the letter or the spirit of the Geneva deal to ease tensions in Ukraine, and said new sanctions against Moscow were already teed up.

The president weighed into an increasingly bitter U.S.-Russian dispute over the actions of separatist militias in the east of the country Washington says are backed by the Kremlin, during his tour of Asia.

"There was some possibility that Russia could take the wiser course after the meeting in Geneva. So far at least we have seen them not abide by the spirit or the letter of the agreement in Geneva," Obama said.

"Instead we continue to see malicious, armed men taking over buildings, harassing folks who are disagreeing with them, destabilizing the region and we haven't seen Russia step out and discouraging it.

Obama however said that the U.S.-backed government in Kiev was taking concrete steps to live up to the Geneva accord, including on moving towards political reforms.

The U.S. leader had staked out a deliberate and skeptical position last week when the agreement, between Ukraine, Russia, the European and Union and Washington, was signed.

Obama left a clear impression that it was a matter of if and not when Washington would go ahead with new, tougher sanctions against Russia, possibly hitting again at President Vladimir Putin's inner circle.

"What I am saying is we have prepared for the possibility of applying additional sanctions," Obama said at a press conference with Japanese Prime Minister Shinzo Abe.

"There are a whole bunch of technical issues behind that."

Those issues including persuading key leaders in Europe that the time for new sanctions is nigh.

- Political dilemma on sanctions -

Many European leaders face a political dilemma over imposing new sanctions given the fact their nations are far more exposed to Russian investment, energy supplies and trade, than the United States.

Washington wants to move in a united front with Europe to make its strategy of isolating Russia more effective -- even if that means the process of upping the pressure on Moscow takes more time.

He also warned that even added pressure on the Kremlin may not change its strategy in Ukraine, following the annexation of Crimea.

"Additional sanctions may not change Mr. Putin's calculus," that is possible."

So far U.S. sanctions have targeted members of Putin's political inner circle, branded as cronies by U.S. officials, with asset freezes and visa bans.

The next round of sanctions will likely cut further into the political elite in Moscow and could include personal measures against prominent business figures.

But U.S. officials have made clear that the most punitive sanctions, targeting lucrative parts of Russia's economy, including the mining and energy sectors, would come into force only if Russia sends forces currently massed on Ukraine's borders into the country.

Obama's intervention came after Russia said it would strike back if its "legitimate interests" in Ukraine are attacked, raising the stakes in the Cold War-like duel with the United States.

NATO responded by cautioning against "veiled threats", saying they violated the spirit of the agreement reached in Geneva to try to pull the crisis-hit country back from the brink of civil war.

Moscow is insisting that Kiev withdraw forces sent to eastern Ukraine on an "anti-terrorist" mission to dislodge pro-Russian rebels, who have occupied government buildings there.

Russian Foreign Minister Sergei Lavrov told state-controlled RT television that if Russia or its interests are attacked, "we would certainly respond".