Update 2: Ambassador Nikki Haley had some choice words for Russia during Monday's emergency meeting of the UN Security Council, blasting Russia's decision to detain three Ukrainian ships as "arrogant" and accusing Russia of making normal relations with the US "impossible." She also accused Russia of violating Ukraine's "sovereign territory" with its annexation of Crimea.

*HALEY CALLS RUSSIAN ACTION IN KERCH STRAIT `ARROGANT'

*HALEY SAYS RUSSIA VIOLATED UKRAINE'S SOVEREIGN TERRITORY

*HALEY: U.S. WILL MAINTAIN CRIMEA-RELATED SANCTIONS ON RUSSIA

*HALEY SAYS SHE SPOKE TO TRUMP, POMPEO ABOUT RUSSIA, UKRAINE

*RUSSIA ACTIONS MAKE NORMAL TIES WITH U.S. `IMPOSSIBLE': HALEY

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Update 1: Poroshenko's plan to impose martial law has been approved, and during an address on national television, the president said it will begin at 9 am local time on Nov. 28 and continue at least until late January. Ukrainians are expected to vote in a presidential election in March.

UKRAINE'S POROSHENKO SAYS MARTIAL LAW WILL BE FROM 9 AM NOV. 28

UKRAINIAN PRESIDENT POROSHENKO ADDRESSES NATION ON TV

UKRAINE'S POROSHENKO REITERATES MARTIAL LAW DOESN'T MEAN WAR

ELECTIONS WILL GO AHEAD ON SCHEDULE

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Seemingly out of nowhere, a diplomatic crisis has erupted between Ukraine and Russia after Russia detained three Ukrainian ships which it said had been "maneuvering dangerously" near the Kerch Strait - a crucial Russia-controlled choke point which separates the Sea of Azov From the Black Sea. In response to what he decried as unprovoked Russian aggression, increasingly unpopular Ukrainian President Petro Poroshenko signed a declaration on Monday to declare martial law for 60 days through Jan. 26. He also started mobilizing the Ukrainian army despite the martial law order still needing approval by the country's Parliament, according to RT.

Ratcheting up the anxieties of NATO commanders, who are probably fearful of being drawn into a potential military conflict with Russia, Ukraine has put its troops on full combat alert (though it isn't a member of NATO, Ukraine has become closely allied with the defense alliance after shelving plans for membership a decade ago). Poroshenko met with the country's military leaders Sunday night to discuss imposing martial law.

As the UN calls an emergency meeting of the Security Council (of which Russia is a permanent member) to be held on Monday, Russia is resisting international demands to release the two Ukrainian artillery boats and the tugboat, which it seized after firing on the ships and ramming one of them. A spokeswoman for the Kremlin said Russia is opening a criminal case into what it claimed was the ships' illegal entry into Russian waters surrounding the narrow Kerch Strait, according to Reuters.

Russian newswire Interfax reported that Russian border guards had detained 24 Ukrainian sailors accused of taking part in the border provocations.

Kiev has maintained that Russia was notified ahead of time that the ships were approaching the strait, and denied its ships had done anything wrong. Russia says the ships disobeyed orders to halt.

Moscow has accused Ukraine of staging the armed provocation, presumably to allow Poroshenko to impose martial law and possibly delay a March election that the president, who is reeling from corruption scandals and failed economic policies, is widely expected to lose.

Fortunately for Ukraine, declaring martial law won't jeopardize its $1 billion IMF bailout.

"The Fund has no formal legal prohibitions that prevent continued cooperation in such conditions," a source close to the fund reportedly told UNIAN.

A bilateral treaty allows both Russia and Ukraine to use the Sea of Azov, access to which is tightly controlled by Russia, which built a land bridge over the Kerch Strait, the only egress from the sea, after the annexation of Crimea in 2014. Ukraine is still bitter over the annexation, and has accused Russia of supporting a pro-Russian insurgency in the country's east. After briefly closing the strait following the incident, Russia has again opened it to traffic. Meanwhile, Russian security agency the FSB has said three Ukrainian sailors had been wounded when Russian ships fired on and rammed their Ukrainian counterparts, though none of these injuries were said to be life threatening. Men dressed in Russian navy uniforms could be seen guarding the ships on Monday as they were being held at a Russian port near Crimea, not far from where Russia's mighty Black Sea fleet is stationed.

Regardless of what happens, the incident could provoke more western sanctions against Russia, which will only further dampen relations between Russia and the West at a time when Russia is building its own financial infrastructure to challenge the dollar-dominated global trade system.

And while European officials have urged both sides to exercise restraint, the incident shows just how easily Russia and the West could be drawn into a military conflict over Ukraine. While it appears a shooting war has been averted - for now, at least - the mobilization of Ukrainian troops on its border with Russia certainly doesn't bode well for peace. The incident has sent the Russian ruble sliding against the dollar, as the sanction fears join concerns about the recent dramatic slump in global oil prices.

That would be quite an escalation for an incident that began with the ramming of a tugboat.