Tensions rise over Crimea dispute

MOSCOW - The Ukrainian government on Monday abruptly banned freight traffic to the Crimean peninsula as tensions with Russia over the disputed territory have reignited into threats of a full-blown trade war.

Russia annexed Crimea in March last year, but the peninsula remains dependent on infrastructure and deliveries from Ukraine for supplies of electricity, water and food.

On Monday, Ukrainian President Petro Poroshenko proposed suspending the dispatch of cargo to the peninsula while his government "defines the model for Ukraine's future relations with the temporarily occupied territory of Crimea," a presidential statement read. Ukraine's cabinet later approved the decision with no time limit.

The ban came two days after power to Crimea was cut in an apparent act of sabotage, as pylons conveying electricity to the peninsula were blown up. Suspicion quickly fell on pro-Ukrainian activists calling for a blockade of Crimea who had been protesting near the site of the attack.

Ukraine's government pledged Monday to return power to Crimea as soon as possible, but it also said it would review whether to continue supplying electricity to the region at all next year. On Monday, activists were preventing repairs to the towers for a second day.

While fighting has significantly decreased between Russian-backed separatists and Ukraine's army in the country's east, the two countries have steadily cut trade, cultural and travel ties in the course of a painful separation that shows no signs of slowing.

Russia is set to introduce sanctions banning the import of most Ukrainian food products starting this January. Moscow has described the move as retaliation for Ukraine joining European Union sanctions against Russia earlier this year.

Ukrainian Prime Minister Arseniy Yatsenyuk on Monday declared that Ukraine will retaliate against the planned Russian sanctions.

Russian and Ukrainian airlines also recently halted all direct flights between the two countries last month.