Thousands of people celebrated in the Crimean capital of Simferopol after the region broke away from Ukraine and was formally accepted into the Russian Federation. Celebrations continued into early Saturday, hours after the Russian president, Vladimir Putin, signed a treaty making Crimea part of Russia. Fireworks burst in the sky in Simferopol, as the Crimean prime minister, Sergei Aksenov, addressed the crowds. "I am sure that we all together will live in a new Crimea happily, we will live the way our fathers and grandfather wanted us to live as we dreamed. This is fair and we deserved it. Happy holiday, dear friends," he said. Crowds also celebrated the accession in Moscow. All 155 senators present in Moscow's upper house of parliament voted on Friday in favour of the treaty of accession, which was signed on Tuesday by Putin. Meanwhile in Brussels, the acting prime minister of Ukraine, Arseniy Yatsenyuk, signed an association agreement with the EU as the split between the two former allies grew deeper.

Sanctions and counter-sanctions

As alliances were made, the EU and the US also announced new sanctions against prominent Russians, including close allies of Putin.

The European bloc on Friday announced it was expanding its list of Russians targeted with sanctions by 12, hours after the US president, Barack Obama, said his administration had imposed sanctions on 20 Russian politicians and senior government officials, in addition to 11 individuals already targeted.

Speaking at the White House, Obama said Russia's threats to southern and eastern areas of Ukraine - which like Crimea have large Russian-speaking populations - posed a serious risk of escalating the crisis in the region.

Also among those top businessmen targeted are Putin-allies such as billionaires Gennady Timchenko, Arkady Rotenberg and Boris Rotenberg plus a bank used by close associates.

Moscow had announced its own sanctions against senior US politicians in retaliation against visa bans and asset freezes imposed by Washington on its citizens.

Meanwhile, Russia's prime minister, Dmitri Medvedev, said that Ukraine owes Russia $11bn, because the treaty under which Russia provides Ukraine with cheap gas in return for the Sevastopol naval base was "subject to denunciation".