Ukraine called on Friday for full membership in NATO, its strongest plea yet for Western military help after accusing Russia of sending in armoured columns that have driven back its forces on behalf of pro-Moscow rebels. Russian President Vladimir Putin, defiant as ever, compared Kyiv's drive to regain control of its rebellious eastern cities to the Nazi invasion of the Soviet Union in the Second World War. He announced that rebels had succeeded in halting it, and proposed that they now permit surrounded Ukrainian troops to retreat.

Speaking to young people at a summer camp, Putin told his countrymen they must be "ready to repel any aggression towards Russia." He described Ukrainians and Russians as "practically one people," language that Ukrainians say dismisses the very existence of their thousand-year-old nation.

The past 72 hours have seen pro-Russian rebels suddenly open a new front and push Ukrainian troops out of a key town in strategic coastal territory along the Sea of Azov. Kyiv and Western countries say the reversal was the result of the arrival of armoured columns of Russian troops, sent by Putin to prop up a rebellion that would otherwise have been near collapse.

Rebels said they would accept Putin's proposal to allow Kyiv forces, who they say are surrounded, to retreat, provided the government forces turn over weapons and armour. Kyiv said that only proved that the fighters were doing Moscow's bidding.

More economic sanctions possible

Full Ukrainian membership of NATO, complete with the protection of a mutual defence pact with the United States, is still an unlikely prospect. But by announcing it is now seeking to join the alliance, Kyiv has put more pressure on the West to find ways to protect it. NATO holds a summit next week in Wales.

Russian President Vladimir Putin said Kyiv must sit down for negotiations with representatives of separatist eastern Ukrainian regions in order to achieve peace. (Reuters)

NATO's Secretary General Anders Fogh Rasmussen said he respected Ukraine's right to seek alliances.

"Despite Moscow's hollow denials, it is now clear that Russian troops and equipment have illegally crossed the border into eastern and south-eastern Ukraine," Rasmussen said. "This is not an isolated action, but part of a dangerous pattern over many months to destabilize Ukraine as a sovereign nation."

Kyiv said it was rallying to defend the port of Mariupol, the next big city in the path of the pro-Russian advance in the south-east.

"Fortifications are being built. Local people are coming out to help our troops, to stop the city being taken. We are ready to repel any offensive on Mariupol," military spokesman Andriy Lysenko said.

So far, the West had made clear it is not prepared to fight to protect Ukraine but is instead relying on economic sanctions, first imposed after Russia annexed Ukraine's Crimea peninsula in March and tightened several times since.

But those sanctions seem to have done little to deter Putin, leaving Western politicians to seek tougher measures without crippling their own economies, particularly in Europe which relies on Russian energy exports.

European foreign ministers met in Milan on Friday ahead of a weekend EU summit in Brussels. They made clear the bloc will discuss further economic sanctions against Moscow. Some said that was no longer sufficient, and other measures to help Kyiv should be discussed.

All options except military action will be considered to punish Russia for pursuing "the wrong path," Luxembourg Foreign Minister Jean Asselborn said.

New EU sanctions against Russia would have to be agreed unanimously — a requirement that has in the past blocked or softened decisions since some nations fear the economic fallout. Russia is the EU's third-largest trading partner and one of its biggest oil and gas suppliers.

Polish Foreign Minister Radoslaw Sikorski said countries that had tried so far to mediate now needed to explain "what their ideas (are) to stop President Putin and save Ukraine as she is." Sweden's Carl Bildt said: "Sanctions alone are not enough: he (Putin) is prepared to sacrifice his own people."

Poland denied permission for Russia's defence minister to fly over its air space after a trip to Slovakia, forcing him to return to Bratislava. Warsaw said he could fly if he reported the status of his plane as civilian rather than military.

'Best not to mess with us'

Moscow still publicly denies its forces are fighting to support pro-Russian rebels who have declared independence in two provinces of eastern Ukraine. But the rebels themselves have all but confirmed it, saying thousands of Russian troops have fought on their behalf while "on leave."

NATO has issued satellite photos of what it says is artillery fielded by more than 1,000 Russian troops fighting in Ukraine. Kyiv has released interviews with captured Russian troops. Reuters has seen an armoured column of Russian troops on the Russian side of the frontier, showing signs of having recently returned from battle with no insignia on their uniforms. Members of an official Russian human rights body say as many as 100 Russian soldiers died in a single battle in Ukraine in August.

Encouraged by state media, Russians have so far strongly backed Putin's hard line, despite Western sanctions that have hurt the economy, the Kremlin's own ban on imports of most Western food, and now reports of Russian troops dying in battle.

Putin's lengthy public appearance on Friday and his overnight statement on the conflict appear to be an acknowledgement that the war has reached a turning point, potentially requiring greater Russian sacrifice.

French volunteers, supporters of Pro-Russian rebels, stands near destroyed Ukrainian military machines at the Lenin square in the town of Donetsk, eastern Ukraine, on Thursday. (Mstislav Chernov/The Associated Press) Putin answered questions from young supporters, some of whom waved banners bearing his face, at a pro-Kremlin youth camp on the shores of a lake. Wearing a grey sweater and light blue jeans, he looked relaxed, but his tone grew intense while he spoke about Russia's military might, reminding the crowd that Russia was a strong nuclear power.

"Russia's partners ... should understand it's best not to mess with us," Putin said.

Putin compared Kyiv's assault on the rebel-held cities of Donetsk and Luhansk to the 900-day Nazi siege of Leningrad in which one million civilians died, perhaps the most powerful historical analogy it is possible to invoke in Russia.

"Small villages and large cities surrounded by the Ukrainian army which is directly hitting residential areas with the aim of destroying the infrastructure," he said. "It sadly reminds me the events of the Second World War, when German fascist ... occupiers surrounded our cities."

He said the only solution to the conflict was for Kyiv to negotiate directly with the rebels. Kyiv has long refused to do so, arguing that the rebels are not a legitimate force on their own but proxies for Moscow, which must agree to rein them in.

NATO membership sought

Earlier, in a statement released by the Kremlin overnight, Putin pointed to the rebels' gains of recent days on the battlefield: "It is clear that the rebellion has achieved some serious successes in stopping the armed operation by Kyiv."

"I call on the militia forces to open a humanitarian corridor for encircled Ukraine servicemen in order to avoid pointless victims, to allow them to leave the fighting area without impediment, join their families," he said.

Pro-Russian rebels in eastern Ukraine have reportedly agreed to provide safe passage for surrounded government troops, despite ongoing heavy fighting in the region. (Maks Levin/Reuters)

In Kyiv, President Petro Poroshenko held an urgent meeting with security advisers overnight, after cancelling a trip to Turkey due to the "radically deteriorating situation."

Prime Minister Arseny Yatseniuk told a government meeting on Friday the cabinet would "bring before parliament a law to scrap the non-aligned status of the Ukrainian state and establish a course towards membership of NATO."

Were NATO to extend its mutual defence pact to Ukraine, it would be the biggest change in the security architecture of Europe since the 1990s. After the Cold War, NATO defied Russian objections and granted its security guarantee to ex-Communist countries like Poland, Hungary and Romania. But it largely stopped at the border of the former Soviet Union, admitting only the three tiny Baltic states Latvia, Lithuania and Estonia.

In 2008 NATO denied Ukraine and Georgia a fast track towards membership. Russia invaded Georgia a few months later.

This year, after Putin annexed Crimea, NATO countries including the United States have repeatedly said they would be prepared to go to war to protect any member, but not to defend non-member Ukraine.

Tweet for tat

Diplomatic skirmishes between Russia and the West are now playing out online. A cheeky "geography lesson" Canada's NATO delegation tweeted over Russian troops "accidentally" wandering into Ukraine has prompted a response from Russia's mission to NATO. Click here for more.