CORRECTED-UPDATE 1-White House warns Russia of more 'costs' over Ukraine

Mon Apr 14, 2014 6:18pm EDT

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(Corrects to Russia instead of Ukraine, 2nd paragraph)

By Jeff Mason and Arshad Mohammed

WASHINGTON, April 14 (Reuters) - The White House warned Russia on Monday that it would face further costs over its actions in Ukraine and said U.S. President Barack Obama would speak with Russian President Vladimir Putin soon.

U.S. officials stopped short of announcing a new set of sanctions against Russia but said they were in consultations with European partners about the prospect.

The European Union agreed on Monday to step up sanctions against Moscow by expanding a list of people subjected to asset freezes and visa bans.

"Russia continues to engage in provocative actions in Eastern Ukraine. The mere presence of the troops, in addition to what else they've done inside Ukraine, creates a threat of destabilization within Ukraine," White House spokesman Jay Carney told reporters.

"I can assure you that Russia's provocations - further transgressions and provocations will come with a cost. And I'm not here to specify what cost will come from which specific action, but there have already been costs imposed on Russia; there will be further costs imposed on Russia."

The next round of U.S. sanctions, which would be the fourth imposed since the Ukraine crisis began, is likely to target Russians close to Putin as well as Russian entities, three sources familiar with the discussions said on Sunday.

U.S. State Department spokeswoman Jen Psaki noted that the United States was prepared to impose sanctions on individuals and entities in the financial services, energy, metals, mining, engineering and defense sectors.

The sanctions have been the most visible sign of U.S. anger at Russia's annexation of the Crimea region in southern Ukraine last month, reflecting the deepest plunge in U.S.-Russian relations since the Cold War.

Obama spoke to French President Francois Hollande about the crisis on Monday and praised Ukraine's government for showing "great restraint" and working to unify the country, the White House said.

Carney also confirmed that the director of the U.S. Central Intelligence Agency, John Brennan, had been in Kiev over the weekend and decried what he called "false claims" leveled at the CIA by Russian authorities.

"Senior level visits of intelligence officials are a standard means of fostering mutually beneficial security cooperation including U.S.-Russian intelligence collaboration going back to the beginnings of the post-Cold War era," Carney said.

"U.S. and Russian intelligence officials have met over the years. To imply that U.S. officials meeting with their counterparts (in Kiev) is anything other than in the same spirit is absurd," he said.

According to media reports, Russia has urged Washington to explain what Brennan was doing in Ukraine. (Additional reporting by Jim Loney; Editing by Mohammad Zargham)

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