Deep Divisions Amid Fragile Ukraine Peace

Ceasefire is a temporary state. It's not the same as lasting peace.

What has been agreed so far is a halt in the bloodshed - the reasons people took up arms in the first place have so far not been addressed.

The Ukrainian President sounds optimistic - a prisoner exchange could begin as soon as this weekend, a second Russian aid convoy could be allowed in.

People buy bread at a market in Mariupol after a ceasefire was signed

The self-proclaimed prime minister of the separatist Luhansk People's Republic is less encouraging.

He said the status of the people's republics had not been discussed, and the ceasefire should not be taken to mean they had abandoned their plans to separate from Ukraine.

The commander of one of the pro-Ukrainian battalions outside Mariupol said they would use the time to regroup and retrain.

The divisions run deep, and not just among the militia.

Plenty of people in the east did not support the winter revolution - from their perspective what they saw was their democratically elected president overthrown, and a government now in Kiev they believe seized power in a coup d'etat.

Some want more regional autonomy, others want their region to secede and join Russia.

On the other side are the pro-Ukrainians who fought for the future of their country on the Maidan, some of whom have now joined volunteer battalions in the east.

Rebel leaders say they have not abandoned their plans to break from Ukraine

They have already seen part of their country annexed by President Vladimir Putin, and believe the Russian army is fighting on the side of the rebels, intervening in their sovereign state.

They want their country to be united, to be allowed to move towards the European Union, and they want their land back.

Militarily we're back to relative stalemate - that in itself is quite a reversal of fortunes.

A couple of weeks ago it seemed the Ukrainian army was in the ascendant - the rebels seemed to be on the backfoot, retreating and largely restricted to the centres of Luhansk and Donetsk.

Over the course of the last fortnight, the rebels have had a sudden and mysterious resurgence - opening a new front in the south threatening the strategic port city of Mariupol, and simultaneously taking villages and towns to the east of the regional capital Donetsk.

Now it's the Ukrainian army losing ground, and the overall balance is roughly back to where it was.

A stalemate in eastern Ukraine would suit Russian President Vladimir Putin

Kiev says that's because Russia is sending troops and equipment across the border - not in sufficient quantities to look like an overt invasion and force the west to act, but enough to stop the rebels from being defeated.

The Kremlin insists any Russian soldiers in Ukraine are either on holiday or lost.

A return to stalemate would quite suit President Putin.

He doesn't necessarily need the rebels to win, and he doesn't seem to want to occupy, and have to defend, eastern Ukraine.

A frozen conflict, that could be thawed as and when necessary, could be just fine.

In terms of domestic Russian politics, President Putin doesn't want the Maidan revolution to be followed by success - his administration has long feared a colour revolution, in the manner of Ukraine or Georgia, fomenting outside the Kremlin walls in Moscow.

Much better that that revolution is synonymous in Russian minds with violence and chaos.

Russian state TV is pushing that narrative heavily at home.

In terms of broader geopolitics, the Kremlin doesn't want a united Ukraine leaving its sphere of influence to join the EU, and maybe one day Nato.

They don't want to find Nato bases on their western border in five years' time.

Keeping a level of control of the east, and an insurgency that has not been defeated, could give Moscow just the leverage it needs.

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Europe Agrees On Fresh Russian Sanctions

European leaders have agreed to hit Russia with a fresh round of sanctions - despite Moscow signing up to a ceasefire in Ukraine.

The sanctions include credit restrictions on Russia companies, export bans, travel bans and asset freezes on a new set of officials, according to a European Union diplomat who spoke on condition of anonymity.

Two branches of the world's biggest oil producer - Gazprom Bank and Gazprom Neft - are targeted by the measures, said the diplomat.

Speaking at the end of a Nato summit in Wales on Friday, David Cameron said sanctions would continue despite both sides agreeing to the 12-point peace plan.

However, the Prime Minister said they could be lifted if a lasting peace was found.

The new restrictions, which will be imposed early next week, come as Britain agreed to supply 1,000 troops to a Nato rapid response force aimed at countering Russian aggression in Ukraine and Eastern Europe.

Nato Secretary General Anders Fogh Rasmussen revealed the plan for the Spearhead force after discussions with members in Newport.

Ukraine was a dominant topic on the final day of the Nato summit

"This decision sends a clear message: Nato protects all allies at all times," he said.

"And it sends a clear message to any potential aggressor: should you even think of attacking one ally, you will be facing the whole alliance."

Western leaders accuse Russia of sending thousands of troops into the east of Ukraine - prompting fears of future incursions into other Eastern European countries.

Mr Rasmussen said the Spearhead force would establish a command-and-control presence in the east of allied territories ready to deploy air, sea and special forces in the event of aggression.

He told Sky News Tonight: "We have decided to improve our ability to act swiftly. The force could be deployed within very few days if needed.

"The intention is to strengthen the defence of our allies."

Mr Rasmussen said alliance countries would contribute troops on a rotational basis to the high-readiness force.

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Ukraine Ceasefire Holds With Pro-Russian Rebels

Deep Divisions Amid Fragile Ukraine Peace

Updated: 12:27pm UK, Saturday 06 September 2014

By Katie Stallard, Moscow Correspondent in Mariupol

Ceasefire is a temporary state. It's not the same as lasting peace.

What has been agreed so far is a halt in the bloodshed - the reasons people took up arms in the first place have so far not been addressed.

The Ukrainian President sounds optimistic - a prisoner exchange could begin as soon as this weekend, a second Russian aid convoy could be allowed in.

The self-proclaimed prime minister of the separatist Luhansk People's Republic is less encouraging.

He said the status of the people's republics had not been discussed, and the ceasefire should not be taken to mean they had abandoned their plans to separate from Ukraine.

The commander of one of the pro-Ukrainian battalions outside Mariupol said they would use the time to regroup and retrain.

The divisions run deep, and not just among the militia.

Plenty of people in the east did not support the winter revolution - from their perspective what they saw was their democratically elected president overthrown, and a government now in Kiev they believe seized power in a coup d'etat.

Some want more regional autonomy, others want their region to secede and join Russia.

On the other side are the pro-Ukrainians who fought for the future of their country on the Maidan, some of whom have now joined volunteer battalions in the east.

They have already seen part of their country annexed by President Vladimir Putin, and believe the Russian army is fighting on the side of the rebels, intervening in their sovereign state.

They want their country to be united, to be allowed to move towards the European Union, and they want their land back.

Militarily we're back to relative stalemate - that in itself is quite a reversal of fortunes.

A couple of weeks ago it seemed the Ukrainian army was in the ascendant - the rebels seemed to be on the backfoot, retreating and largely restricted to the centres of Luhansk and Donetsk.

Over the course of the last fortnight, the rebels have had a sudden and mysterious resurgence - opening a new front in the south threatening the strategic port city of Mariupol, and simultaneously taking villages and towns to the east of the regional capital Donetsk.

Now it's the Ukrainian army losing ground, and the overall balance is roughly back to where it was.

Kiev says that's because Russia is sending troops and equipment across the border - not in sufficient quantities to look like an overt invasion and force the west to act, but enough to stop the rebels from being defeated.

The Kremlin insists any Russian soldiers in Ukraine are either on holiday or lost.

A return to stalemate would quite suit President Putin.

He doesn't necessarily need the rebels to win, and he doesn't seem to want to occupy, and have to defend, eastern Ukraine.

A frozen conflict, that could be thawed as and when necessary, could be just fine.

In terms of domestic Russian politics, President Putin doesn't want the Maidan revolution to be followed by success - his administration has long feared a colour revolution, in the manner of Ukraine or Georgia, fomenting outside the Kremlin walls in Moscow.

Much better that that revolution is synonymous in Russian minds with violence and chaos.

Russian state TV is pushing that narrative heavily at home.

In terms of broader geopolitics, the Kremlin doesn't want a united Ukraine leaving its sphere of influence to join the EU, and maybe one day Nato.

They don't want to find Nato bases on their western border in five years' time.

Keeping a level of control of the east, and an insurgency that has not been defeated, could give Moscow just the leverage it needs.

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IS Leader's Top Aide 'Killed In Iraq Airstrike'

ISIS Leader Is Jihad's 'Rising Star'

Updated: 8:49am UK, Thursday 12 June 2014

Abu Bakr al-Baghdadi, commander of the Islamic State in Iraq and Syria (ISIS) controls large parts of eastern Syria and western Iraq.

But despite his power - and a $10m (£5.9m) US reward for information leading to his capture - little is known about a man who for his own survival has shunned the spotlight.

Fighters from ISIS and its rivals have praised Baghdadi as a strategist driven by an unbending determination to fight for and establish a hardline Islamic state.

He has succeeded in exploiting turmoil in Syria and Iraq's weak central authority after the US military withdrawal to carve out his powerbase.

He has also proved ruthless in eliminating opponents to further his ambition of creating an Islamist state.

According to the US reward notice, which depicts a round-faced, brown-eyed man with closely cropped beard and short dark hair, Baghdadi was born in the Iraqi town of Samarra in 1971.

He is said to be the only prominent al Qaeda leader not to pledge allegiance to Ayman al-Zawahiri after Osama bin Laden's death three years ago.

He split with Zawahri after falling out with al Qaeda's Nusra Front in Syria, whose leader Abu Mohammad al Golani rejected an edict to merge his forces under Baghdadi's command.

While Baghdadi's supporters believe an Islamic state would revive the glories of Islam, they say Zawahiri feared that by drawing jihadi fighters together in one place it would make it easier for the West to defeat them.

His fighters counter that Baghdadi has plenty of hidden surprises for his enemies.

"He has capabilities that he keeps secret until the right time," one ISIS supporter said.

Ignoring Zawahiri's calls to leave Syria to the Nusra Front, Baghdadi expanded operations across northern and eastern Syria in 2012 and 2013, sometimes battling Bashar al Assad's forces but more often pushing out other rebel fighters.

Baghdadi's fighters now control the city of Raqqa - Syria's only provincial capital completely beyond Assad's control - and have imposed strict Islamic law.

In neighbouring Deir al-Zor province ISIS has waged a six-week offensive against rival rebels in which 600 fighters have been killed, seizing oilfields and towns on the northeast bank of the Euphrates, 60 miles (100 km) from the Iraqi border.

There is also video evidence of ISIS in the Syrian town of Azaz, with territory they controlled marked by graffiti on the walls and a flying flag.

Video also appeared on a social media website in January purported to show the northern Syrian town of Manbij after it was captured from rival insurgents by fighters from ISIS.

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Hostage David Haines' Family Under Police Guard

The Croatian family of David Haines, the British hostage held by Islamic State, are receiving 24 hour police protection, Sky sources say.

Mr Haines, who has a wife and four-year-old daughter in Zagreb, was threatened with death in the recently released video of the beheading of US journalist Steven Sotloff.

The aid worker was taken from a refugee camp close to the Syrian border with Turkey in March 2013.

The 44-year-old has worked for aid agencies in some of the world's worst trouble spots, including Libya and South Sudan.

He also has a teenage daughter in Scotland from a previous marriage.

US Secretary of State John Kerry, meanwhile, announced the formation of a "core coalition" to tackle IS militants, who have seized control of much of northern Iraq and Syria. 

Speaking at the Nato summit in Newport, he urged the United Kingdom, France and Australia, as well as other nations, to provide the air power, intelligence, weapons and equipment to go after the group inside Iraq.

And Iraqi officials said an airstrike had killed a senior aide of IS leader Abu Bakr al Baghdadi. 

Steven Sotloff was the second US journalist beheaded in an IS video

Prime Minister David Cameron on Thursday ruled out paying a ransom to the militants for Mr Haines' release, describing such payments as "utterly self-defeating".

He acknowledged it was a "desperately difficult situation" and said he was personally overseeing efforts to bring the aid worker home safely.

Mr Haines' Croatian wife earlier told The Daily Telegraph: "He's everything to us. He's our life. He's a fantastic man and father.

"Nobody can understand how we are feeling. My daughter keeps asking about him every day. She hasn't seen her father for a year and a half. She has gone through so much. She sees me crying all the time," Dragana Prodanovic Haines said at the family's home near Zagreb.

Muslim religious leaders across Scotland are using Friday prayers to call for the release of all hostages held by IS.

A joint statement from the Muslim Council of Scotland, Islamic Society of Britain and Glasgow Central Mosque, said: "We send our heartfelt sympathies to the families of those who have been killed at the murderous hands of IS - regardless of where they are from or what their religion.

"The actions of IS are against the teachings of Islam and therefore supporting or joining such an organisation is unacceptable.

"We call for the immediate release of all hostages held by IS and pray for all of those killed, injured or harmed by extremism the world over."

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US Forming 'Core Coalition' To Combat IS

The US is forming a "core coalition" to battle Islamic State militants in Iraq, top American officials have said.

US Secretary of State John Kerry and Defense Secretary Chuck Hagel called for support as they held talks with officials from 10 nations on the sidelines of a Nato summit on a strategy to defeat IS.

"We need to attack them in ways that prevent them from taking over territory, to bolster the Iraqi security forces and others in the region who are prepared to take them on, without committing troops of our own," Mr Kerry said.

"Obviously I think that's a red line for everybody here: no boots on the ground," he added.

David Cameron (L) and John Kerry at the summit

Mr Kerry said he was aware that many nations would not want to do military strikes, but he said they could provide intelligence, equipment or weapons.

The talks were held with defence and foreign ministers of Britain, France, Germany, Canada, Australia, Turkey, Italy, Poland and Denmark.

"This group here this morning is the core coalition," Mr Hagel told them.

"It is the core group that will form the larger and extended coalition that's going to be required to deal with this challenge."

The US has launched airstrikes in Iraq against the Sunni militants but is looking to expand its campaign after two videos showed the beheading of two American journalists held captive by the group, James Foley and Steven Sotloff.

An Iraqi airstrike has reportedly killed a senior aide of IS leader Abu Bakr al Baghdadi.

IS, an al Qaeda offshoot also known as ISIS and ISIL, has gained control over vast swathes of Iraq and Syria. It controls the territory with a strict interpretation of Islamic law and has gone after religious minorities.

The US stressed the need for a comprehensive approach in the talks on Friday and acknowledged that action against IS in Iraq would have implications in Syria as well.

"We're convinced in the days ahead we have the ability to destroy ISIL. It may take a year, it may take two years, it may take three years," Mr Kerry said.

"But we're determined."

Washington is looking to have solid plans in place by the time the United Nations General Assembly meets in two weeks.

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Sky Films Troops 'In Russian Gear' In Ukraine

Confusion Over Ukraine 'Permanent Ceasefire'

Updated: 3:38pm UK, Wednesday 03 September 2014

Vladimir Putin says a ceasefire deal between Ukraine and pro-Russian rebels could be reached by Friday.

The Russian President's announcement comes after conflicting reports that a permanent ceasefire agreement had been reached by the two sides this morning.

Following witness reports of loud artillery explosions near the Ukrainian city of Donetsk, the country's President Petro Poroshenko modified his statement to remove the word "permanent".

It is unclear whether his actions were in response to reports of the explosion.

Reporting from Mariupol, Ukraine, Sky's Moscow Correspondent Katie Stallard said: "It's extremely unclear at this stage what exactly this ceasefire is supposed to be.

"No one we have spoken to on the ground seems to know about it.

"The Ukrainian president issued a statement this morning claiming he agreed with Vladimir Putin to a permanent ceasefire in the region.

"He has since slightly modified that statement and removed the word 'permanent'.

"A spokesman for President Putin said no such agreement has been reached, nor can it, because Russia is not a party to the conflict."

Mr Putin's spokesman Dmitry Peskov was earlier quoted as saying the leaders' views "overlap to a considerable degree".

"The heads of state exchanged opinions about what needs to be done first in order to bring an end to the bloodletting in the southeast of the country as soon as possible," said Mr Peskov.

A statement from Kiev said an understanding had been achieved which would enable the "establishment of peace".

News of the development was greeted with an immediate rally on the financial markets - the main Russian stock exchange, the Micex, rising 4% and stocks in London with the FTSE 100 reached a 14-year high in morning trade.

Russia later announced it was to hold major military exercises in September of the forces responsible for its long-range nuclear capability. The drills will involve more than 4,000 servicemen and 400 technical units. 

Meanwhile, world leaders have begun arriving in the UK ahead of a two-day Nato summit in Wales where the Ukraine crisis will be top of the agenda. 

Speaking in Estonia ahead of the summit, President Obama said that Nato would not accept what he called Russia's illegal annexation of Crimea.

In a thinly-veiled warning to President Putin, the US President added that the Baltic states were bound by the Nato alliance.

"We have a solid duty to each other. Article Five is crystal clear; an attack on one is an attack on all," he said.

Mr Obama added the US was working to bolster the security of Nato allies and increase America's military presence in Europe.

"It would mean more US forces, including American boots on the ground continuously rotating through the Estonia, Latvia and Ukraine militaries."

Russia has repeatedly denied claims its soldiers were recently sent into eastern Ukraine to support Ukrainian pro-Russian rebels.

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Ukraine Troops In Call For Better Arms

By Yulia Bragina, Russia Producer, In Eastern Ukraine

On the highway between Donetsk and Mariupol in eastern Ukraine near the village of Volnovakha, there stood a military transporter with an old, self-propelled artillery gun and tired-looking men perched on it.

Having spent several hours trying to find the Ukrainian military, the Sky News team decided to pull over and speak to them.

They told us they got separated from the column when the engine of their transporter got overheated - again - as they were making their way from a mission near the town of Starobesheve.

Trench dug by Ukrainian soldiers outside Mariupol

The soldiers asked our team to tell the checkpoint on the outskirts of Mariupol that they had broken down because they had no other way of informing their commander.

"We are too close to the rebel-held territory here. If we don't get help quickly, we will not survive the night," said Artyom, 22.

The men told us they had earlier engaged with a Russian military convoy closer to the border.

A member of the Azov battalion stands guard at their base in Mariupol

"The APCs (armoured personnel carriers) that we were fighting against had a parachute painted in the front. That's a symbol of Russian paratroopers," said Artyom.

"They are not even hiding anymore. I have seen with my own eyes the Russian military convoy crossing from Russia into Ukraine on August 18, but no one believes us."

A few kilometres away we met another Ukrainian military vehicle on its way to the front line, and one of the officers agreed to talk to us anonymously.

Soldiers like Roman say there is a lack of basic equipment

Petro (not his real name) said he was 28, had a wife and three children and had been serving in the Ukrainian army for nine years.

He was angry with the policies of the government in Kiev which he regarded as too indecisive, and warned that if it continued the army would turn and march on the capital.

Petro criticised Western politicians for not supporting Ukraine with positive action. What they needed, he said, was modern equipment and arms, not words.

Roman shows off the sneakers supplied by a family member

"We have many patriots who want to defend their country, but people are just scared to fight with tanks and APCs that are 30 to 40 years old," he said.

His call was echoed by members of the volunteer Azov battalion on the outskirts of Mariupol like 27-year-old Roman.

Roman, a veteran of nine firefights, said the sneakers he was wearing had been sent to him by his brother who lives in Florida.

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PM: UK Will Not Pay For British IS Hostage

Nato Plans 'Spearhead' Force To Face Russia

Updated: 12:53pm UK, Tuesday 02 September 2014

Nato is set to create a high-readiness force and stockpile military equipment in Eastern Europe as a bulwark against potential Russian aggression, the alliance's chief has said.

Secretary General Anders Fogh Rasmussen said the proposed new force could be comprised of several thousand troops contributed to on a rotating basis by the 28 Nato countries.

Backed by air and naval assets, he said the unit would be a spearhead that could be deployed at very short notice to help Nato members defend themselves against any threat, including from Russia.

Nato leaders are to consider the plans at a summit this week in Wales that is likely to be dominated by how the US-led alliance should respond to the Russian-backed separatist uprising in eastern Ukraine.

Ukraine is not a member of Nato, but its UK ambassador told Sky News he backed the move and appealed for Ukraine's allies to step up sanctions and provide military help now.

Andrii Kuzmenko said: "What is important for Ukraine is to provide the means for our defence ... including armaments."

The move could provoke Russia, whose foreign minister warned on Monday that Ukrainian forces must pull back from areas where they can harm civilians.

Sergei Lavrov spoke amid reports that Ukrainian forces had been ordered to pull back from Luhansk airport in the face of an onslaught from Russian tanks - the latest claim of direct Russian involvement in the fighting.

Ukrainian Defence Minister Valeriy Geletey said Russian units were moving into other towns in the region, including the largest city of the Donetsk region.

"The information that Russian troops are there has been confirmed," he said.

"We are fighting Russia and it is Russia which is deciding what will happen in Donbass," he told Ukraine's Inter channel, referring to the informal name of the Donetsk and Lugansk regions.

Mr Lavrov again denied that Russian troops were in Ukraine and said he hoped talks taking place in the Belarussian capital Minsk would focus on agreeing an immediate, unconditional ceasefire.

Speaking in the east Siberian city of Yakutsk on Monday, Russian President Vladimir Putin accused Europe of ignoring the Ukrainian army "directly targeting its fire on residential areas".

He said he hoped "common sense will prevail" and that Russia and the West would not harm each other with further sanctions.

Speaking in the House of Commons, David Cameron said Russia appeared to be trying to force Ukraine "to give up its democratic choices at the barrel of a gun".

The PM said the presence of Russian soldiers on Ukrainian soil was "completely unjustified and unacceptable".

A rights group that works to expose Russian army abuses claims up to 15,000 soldiers have been sent to Ukraine by Moscow in the last two months, and several hundred may have died in combat.

Valentina Melnikova, head of the Committee of Soldiers' Mothers, a prominent organisation representing the families of military servicemen, said that some 7,000-8,000 Russian troops are believed to be in Ukraine at present.

"Military commanders are conducting a secret special operation," said Ms Melnikova, who is a member of the defence ministry's public council.

Meanwhile, a Ukrainian military spokesman said a rescue operation was continuing for two seamen missing in the Azov Sea after pro-Russian separatists attacked a Ukrainian navy vessel for the first time.

Eight other seamen survived the attack and were being treated for wounds and burns after the vessel was hit by artillery from the shore.

Separatists in the region claimed responsibility for the attack on social media.

Ukrainian President Petro Poroshenko said the events of the past few days showed Russia had launched a "direct and open aggression" against Ukraine.

Leading American senators have called for the US to send weapons to help Ukraine defend itself against what they called a "Russian invasion".

Democrat Robert Mendez, who runs the Senate Foreign Relations Committee, told CNN: "We should provide the Ukrainians with the type of defensive weapons that will impose a cost upon Putin for further aggression."

The call was echoed by former Republican presidential candidate John McCain, who told CBS's Face The Nation that Mr Putin was "an old KGB colonel that wants to restore the Russian empire".

Earlier, the European Union gave Russia a week to scale back its intervention in Ukraine, warning of further sanctions.

China opposes additional sanctions against Russia and has urged world leaders to find a political solution to the crisis.

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Sotloff Family Grieving After Hostage Killed

The family of US hostage Steven Sotloff have seen a video which purportedly shows him being beheaded by an Islamic State fighter, and are grieving privately.

Barak Barfi, a family spokesman, also said authorities have not established its authenticity.

He said: "The family knows of this horrific tragedy and is grieving privately. There will be no public comment from the family during this difficult time."

Mr Sotloff, 31, was a freelance journalist for Time and Foreign Policy magazines who went missing in Syria.

He was apparently killed by IS in revenge for US airstrikes on the Islamist militant group in Iraq.

Mr Sotloff has reportedly been killed by Islamic State

His reported death comes two weeks after the release of a video showing the killing of fellow US citizen James Foley and Mr Sotloff being threatened with death.

That led to Mr Sotloff's mother Shirley pleading for her son's life.

A friend of both hostages, Matthew Van Dyke, told Sky News it was time for the US to consider paying ransoms to secure the release of hostages.

IS had reportedly demanded £80m for Mr Foley's release.

But the US - unlike several European countries that have given millions to the terror group to spare their citizens - refused to pay.

Mr Van Dyke told Sky News he hoped the apparent killing was a "wake-up call to Americans", adding: "This is a serious threat".

Shirley Sotloff had pleaded for her son's life

He went on: "They are executing Americans and videotaping it and we need to do something about that. The US administration needs to get serious about the problem."

Mr Van Dyke said there were more Americans being held by IS and "we need to bring them home".

He said authorities should "re-examine the policy of paying ransoms for prisoner exchanges to at least get these people home and then take on IS and kill them before they get to spend the money."

Mr Van Dyke said the news of Mr Sotloff's reported death was "horrible", adding: "I've lost two friends in two weeks."

He said Mr Sotloff was a "brilliant journalist, hard working and dedicated".

"He knew the dangers but he knew the story needed to be told."

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Russia And Ukraine Agree 'Permanent Ceasefire'

Russian President Vladimir Putin and his Ukrainian counterpart Petro Poroshenko have agreed a ceasefire to end the conflict in Ukraine, Kiev says.

"Mutual understanding was achieved concerning the steps which will enable the establishment of peace," a statement from Mr Poroshenko's press office said, after he and Mr Putin spoke by telephone.

Despite the announcement a deal had been reached, a spokesman for Mr Putin declared the deal was not technically a ceasefire as Russia was not party to the Ukraine conflict.

Putin and Poroshenko were unable to agree when they met last week

But Mr Putin's spokesman Dmitry Peskov was quoted as saying the leaders' views "overlap to a considerable degree".

"The heads of state exchanged opinions about what needs to be done first in order to bring an end to the bloodletting in the southeast of the country as soon as possible," said Mr Peskov.

A few hours after the announcement witnesses said they heard loud artillery explosions on the northern outskirts of the eastern Ukrainian city of Donetsk.

News of the developments was greeted with an immediate rally on the markets - the main Russian stock exchange, the Micex, rising 4%.

The rouble also clawed back 1.3% against the US dollar, having fallen to record lows at the height of the crisis. Airline and banking stocks also rose in London with the FTSE 100 reaching a 14-year high in morning trade.

The news came as Russia announced it was to hold major military exercises in September of the forces responsible for its long-range nuclear capability. The drills will involve more than 4,000 servicemen and 400 technical units. 

Meanwhile, world leaders have begun arriving in the UK ahead of a two-day Nato summit in Wales where the Ukraine crisis will be at the top of the agenda. 

The conflict will be at the top of the agenda at the Nato summit in Wales

At an address in Estonia today ahead of the summit, President Obama reminded journalists of America's military commitment to the region.

"In Ukraine earlier this year the United States increased our presence further," he said.

"We have contributed additional aircraft to the Baltic policing mission and we are continuously rotating personnel and aircraft through the Baltics."

Mr Putin and Mr Poroshenko met last week in Minsk but made no progress towards resolving the conflict, which has intensified in recent weeks as the West and Kiev accused Russia of deploying troops in Ukraine.

Foreign Secretary Philip Hammond recently warned that Nato must show it still has the political will to fight back in the event of a Russian attack on any member states.

Mr Hammond said: "For Nato to maintain its credibility in the future, we have to demonstrate that we maintain the political will to act to defend ourselves and our interests.

"We have to be clear that we have not lost the appetite to intervene when our interests or our obligations require us to do so."

Despite the claims, Russia has repeatedly denied its soldiers were sent into eastern Ukraine.

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IS Beheading: Militants Threaten Brit Hostage

Sotloff: Driven Reporter And Mideast Expert

Updated: 12:29pm UK, Wednesday 03 September 2014

Steven Sotloff, the US journalist who was beheaded by Islamic State militants, was passionate about the Middle East and had long worked in the area.

Friends and colleagues described 31-year-old Mr Sotloff as an honest and courageous journalist who sought to understand the culture of the places he reported from and tell the stories of the people affected by conflict.

His work appeared in Time, Foreign Affairs and World Affairs magazines.

"Steven was very ethical, very driven, an exceptional journalist and an exceptional person," said Matthew Van Dyke, an activist and film-maker who met Mr Sotloff in Libya in 2012.

"He was also a cautious journalist, he did everything the right way," he told Sky News.

Mr Sotloff vanished in Syria in August 2013. His capture was kept secret for months at the request of his family, who said they were now grieving privately.

He then appeared in a video that showed the beheading of fellow US journalist James Foley last month.

A Miami native, Mr Sotloff attended the University of Central Florida, where he took an interest in journalism. He did not graduate from the university.

"Devastated and crushed. Steve was an amazing friend. Lucky to have him in my life. Heart is heavy for his family," Emerson Lotzia, who roomed with Mr Sotloff at UCF, said via Twitter.

He covered the Arab Spring uprisings and several Middle East hotspots, including Yemen, Egypt and Libya. He learnt Arabic.

"He lived in the region for a time, he really got to know the people, the culture," said Mr Van Dyke.

"This was a region that was important to him, he wasn't somebody who jumped from conflict to conflict all over the world, he was a regional specialist and he knew what he was doing."

In his Facebook and Twitter profiles Mr Sotloff called himself a "stand-up philosopher from Miami" and often spoke of his love for the Miami Heat.

In June 12, he tweeted: "Is it bad that I want to focus on #syria, but all I can think of is a #HEATFinals  repeat".

A statement by World Affairs released on August 20 described Mr Sotloff as "an honest and thoughtful journalist who strives to understand the story from local perspectives and report his findings straightforwardly. He is certainly courageous".

The executive director of the New York-based Committee to Protect Journalists said Mr Sotloff, like Mr Foley, had gone to Syria "to tell a story".

"Journalists know that covering war is inherently dangerous and that they could get killed in crossfire," Joel Simon said.

"But being butchered in front of camera simply for being a reporter is pure barbarism."

The group said that at least 70 other journalists have been killed covering the conflict in Syria, including some who died over the border in Lebanon and Turkey.

More than 80 journalists have been kidnapped in Syria, it said.

Some Western journalists are believed to be in the hands of IS.

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Chinese War On Terror May Breed Extremists

By Mark Stone, Asia Correspondent in Xinjiang Province, China

Sky News has obtained rare access to China's Xinjiang Province to investigate reports Muslims are being targeted and oppressed by the government.

China's leaders say foreign Islamist extremists, perhaps with links to IS and al Qaeda, are infiltrating its population, responsible for growing unrest in the region.

Since December, a series of bloody bomb and knife attacks have killed more than a hundred people across China.

There are reports of authorities targeting and oppressing Muslims

Urumqi, a city on the old Silk Road with a population of three million, is the provincial capital and a place on edge right now.

Soldiers stand guard outside the city's great mosque. Armoured police vehicles are parked in the shadows.

Oil and gas rich, the far-western province of Xinjiang is home to the Uighur people, China's Muslim minority. The province was once almost all theirs.

These days, they share it with the Han Chinese, the country's dominant ethnic group; the people who would be globally recognisable as Chinese.

Xinjiang is home to the Uighur people, China's Muslim minority

In recent years, relations between the Uighurs and the Han have become increasingly difficult.

Ancient Uighur homes have been destroyed. Uighur culture has been diluted and their freedom to practise Islam has been restricted.

In May, two 4x4 vehicles drove up a busy market street in a Han Chinese district of Urumqi. It was early morning and Gongyuan Street was crowded with shoppers.

Explosives were thrown from the vehicles as they passed up the street. Forty-three died and more than 90 were injured.

Today, the same street is almost deserted. We meet Mr Sun, a retired Han Chinese teacher.

He saw it all happen and we ask him who did it. "Minorities," he says. He leans forward and whispers: "Muslims."

The Uighur heartland lies under 200 miles from Afghanistan and Pakistan

Our taxi driver, also Han Chinese, goes further. Echoing the government line, he says the attack was the work of religious fanatics infiltrating the south.

"From Kashgar," he says. "It's only those who are uncultured who cause problems.

"People who were not educated, who live in the south. They are brainwashed by terrorists."

The Chinese government says it is facing an unprecedented threat from Islamist extremism.

They say foreign extremists are infiltrating the Uighur population and radicalising them.

Ancient Uighur homes have been destroyed... ...and replaced by tower blocks

However, Uighurs in exile, human rights organisations and the US government doubt that Islamist extremism is to blame.

They believe the Communist Party is blaming external forces as a way of dealing with internal unrest.

The tactics used to counter the violence are exacerbating the problem, they say.

Kashgar is further west from Urumqi; closer to Baghdad than it is to Beijing.

It is the Uighur heartland and lies just under 200 miles from the Afghan and Pakistani borders.

10 million Uighurs live in China's far-western Xinjiang Province

At the city's centre, the Id Kah mosque is the country's largest. In July, the Imam was murdered here; stabbed and clubbed to death.

"He deserved to die," a Uighur shopkeeper tells me quietly. He does not want to be identified. All Uighurs fear government reprisals if caught talking to foreigners.

The shopkeeper tells me that the Imam was a stooge of the Chinese government and condoning a series of restrictions for Uighurs in the region.

The restrictions are spelt out on a sign in a neighbouring street. With pictures, it states that beards are banned for young men and veils are banned for women.

Other policies include preventing Muslims from fasting at Ramadan.

"You understand what this sign means?" a young Uighur man says. "There's no freedom for us here."

The message was the same from the other Uighurs we spoke to. If you pressure and restrict people, they will fight back.

There are signs all around that this Chinese "war on terror" is intensifying. As it does, the resentment will only increase.

If religious extremists are among the Uighur population, and we saw no evidence of it, their efforts to recruit and to rally will only be made easier.

For the Chinese government, Islamist extremism could become a self-fulfilling prophecy.

:: Click here to watch an extended version of Mark Stone's journey into Xinjiang

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Rare Visit To Town At Centre Of Massacre Claims

Avoiding The Chinese Authorities

Updated: 1:55am UK, Tuesday 02 September 2014

By Mark Stone, Asia Correspondent in Xinjiang Province, China

Reporting anything sensitive in China requires planning, a bit of stealth and some luck thrown in too.

China's far western province of Xinjiang is one of those areas (like Tibet and Tiananmen Square) where the country's Communist government is particularly sensitive.

Foreign journalists are not banned from visiting Xinjiang, it's just that we can't report freely when we get there.

The Chinese government is obsessed with controlling the message. Its state-run media is the perfect tool, loyally conveying the government-endorsed line.

And so the idea of foreign journalists wandering around in a region which China considers to be the frontline in its "war on terror" is not something they are willing to allow.

They do not want scrutiny of the tactics they deploy to deal with those they believe to be Islamist extremists.

The team at Sky's bureau in Beijing had tried for months to get permission for a fully sanctioned trip to the region.

The Chinese government has pumped huge investment into the resource-rich province. They claim to have transformed the lives of millions - both indigenous Uighur Muslims and the Han Chinese who have moved here over the past few decades.

We wanted to see that investment: the new high-speed rail line, the new hospitals, schools, universities.

We also wanted to examine the suggestions that the Chinese government is eroding the culture and religion of the Uighurs, perhaps fuelling unrest.

Our trip was initially given a tentative green light. But then, a week before we were due to travel, they U-turned: the trip was off.

No explanation was given. We decided to come anyway.

Colleagues of mine from other media organisations have been here recently. Most have been detained and some have had their images and video deleted.

So it's necessary to stay one step ahead of the authorities. Flights are booked at the last minute, different hotels night to night, check in late, check out early. We use small tourist-style cameras.

I'll admit, it's easy to get overly paranoid. Do the authorities really care that much about what we're doing? It turns out they do.

In Kashgar we tried to check into one hotel but were turned away. The staff noticed our journalist visas in our passports.

"You can't stay here," the receptionist said. "You must stay in the hotel down the road: it's the hotel for journalists."

After a few days of moving every day, complacency set in: we stayed two nights in the same place. It was a mistake.

On the second day, we had a call. "This is reception. The Kashgar police are downstairs to see you. Please come down."

We had a chat with two men. What were we reporting on? Did we have permission?

We showed them the paperwork for our original pitch for the rejected trip. It seemed to work.

The police took photos of us and then left, but not before admitting that they'd been trying to track us down for three days.

A constant worry is the prospect of having our footage deleted or destroyed. In 2012, a German TV crew was on an assignment in another part of China.

They left their hotel room for dinner. When they returned, the reporter's tablet computer and smartphone had been dunked in water. They were still wet and their contents destroyed.

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Islamic State Guilty Of 'Ethnic Cleansing'

Iraq Warns Of 'Imminent Danger' Of IS Militants

Updated: 3:17pm UK, Monday 01 September 2014

Miltants from Islamic State pose a threat to every country in the world, Iraq was warned the United Nations.

The jihadist group - previously known as ISIS - has committed barbaric acts against civilians and threatens to break up Iraq in its aim of establishing a caliphate across a large swathe of the Middle East, Iraq's human rights minister told an emergency debate at the UN Human Rights Council.

The debate took place as Human Rights Watch (HRW)  released evidence of Islamic State (IS) fighters using widely-banned cluster munitions in Syria - where they are already in common use by President Bashar al Assad's forces.

Mohammed Shia al Sudani said: "The land of ancient Babylon is subjected to threats starting with its very independence, they are attempting to change its demographic and cultural composition.

"ISIS is not an Iraqi phenomenon, it is a transnational phenomenon that poses an imminent danger to all countries of the world, it defies all human rights principles and international law."

Iraq's appeal came after the first Islamic State suicide bomber captured in Iraq spoke to Sky News, warning that jihadists from around the world, including Britain, are flooding into Iraq and Syria to join the extremist cause.

Senior UN officials said there was evidence that both IS and Iraqi government forces have killed civilians and committed atrocities in three months of fighting.

UN Deputy High Commissioner for Human Rights Flavia Pansieri said there was "strong evidence" that IS fighters and linked groups had carried out targeted killings, forced conversions, abductions, sexual abuse and torture.

She also said Iraqi police have executed detainees, while Iraqi soldiers have shelled towns and carried out airstrikes, killing and injuring many civilians.

Ms Pansieri voiced deep concern at the persecution of Christians, Yazidis, Shia, Turkmen and other ethnic groups by IS forces that have swept through western and northern Iraq since June, driving 1.2 million Iraqis from their homes.

She said: "The reports we have received reveal acts of inhumanity on an unimaginable scale."

Violence in Iraq killed at least 1,420 people in August, with more than 1,370 injured during the month, the UN's Iraq mission said.

The one-day session in Geneva was called by Iraq with the support of allies including the United States.

The 47-member state forum is expected to agree to Baghdad's request to send a team of UN experts to investigate crimes committed by IS and others in the conflict.

Meanwhile, Iraqi Kurdish forces and Shia militiamen retook Sulaiman Bek from IS on Monday - regaining a key stronghold held by the extremists for more than 11 weeks.

Fighting to retake the village of Yankaja, also located in Salaheddin province, northeast of Baghdad, was ongoing, the official responsible for the nearby Tuz Khurmatu area said.

In Amerli, where Iraqi security forces, Kurdish fighters and Shia militiamen broke an 11-week siege over the weekend, outgoing PM Nouri al Maliki vowed that Iraq would be "a graveyard" for IS.

A clean-up was also under way in Ramadi - 70 miles (115km) west of Baghdad - after a suicide bomber rammed an explosive-packed car into a police checkpoint, killing at least 14 people.

In Syria, New York-based group HRW said reports from local Kurdish officials and photographic evidence suggested IS had used cluster bombs on July 12 and August 14.

They were deployed in fighting around the town of Ayn al Arab in Aleppo province, near the border with Turkey, in clashes between the jihadist group and Kurdish fighters.

The group said it was believed to be the first time IS had used cluster bombs, but it was unclear how it had acquired them.

Cluster munitions contain dozens or hundreds of small bomblets and can be fired in rockets or dropped from the air.

They spread explosives over large areas and are indiscriminate in nature, often continuing to maim and kill long after the initial attack when previously unexploded bomblets detonate.

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Captured IS Suicide Bomber Reveals Threat

By Stuart Ramsay, Chief Correspondent

A wing of Sulaymaniah's military hospital has been sealed off and 24-hour security has been posted at the door of a ward.

Inside lies an injured young man; a very special patient and prisoner.

He is 23-year-old Horr Jaffer, from Chechnya, and he is an Islamic State (IS) suicide bomber.

His capture has been a secret until now.

Sky News is the first to get access to this man who was caught in the southern Kurdish town of Jalula after his bomb part exploded.

He had been attempting to destroy a Kurd checkpoint by driving a bomb-laden car into their midst.

The 23-year-old militant killed four people in his bomb attack

Four people died and many others were injured, but he was captured attempting to escape.

Under questioning he admits that he joined IS in Syria after his father, mother and six family members were killed there.

He says they had moved from Chechnya to Pakistan before going to Syria.

The Kurds believe his father and brothers were to all intents and purposes professional jihadists; moving to countries where they could ply their trade. That trade is killing people.

"I want to be a martyr. I decided after they killed my family," he says in barely audible Russian.

"They didn't tell me anything about what I was doing or where I was. I just had to press the button."

The killer claims that Syria is filling with foreign fighters; a constant stream from all over the world.

"There are nations from all over the world there. There is British amongst them. They are from Asian countries, Europe and America. From everywhere," he told me.

He says that they used to talk together and mix together but didn't understand a lot of what was said.

Spending an hour with him it was striking how little he knew about what IS is doing across swathes of Syria. He denied any knowledge of the creation of a caliphate by IS for example.

He struck me as a rather stupid boy, upset by the loss of his family and totally open to indoctrination by his IS handlers.

He was just the guy prepared to die and kill others with him and it seems there are lots like him.

When asked if he regretted what had happened he broke down.

Britain is growing increasingly concerned about the threat from IS

Arching his back in pain and misery, saying he just wanted to live a normal life that he did not mean to do what he did.

It is hard not to be moved by his anguish. Hard but not impossible. He is a killer.

Like many western governments and security services, Britain is growing increasingly concerned about both IS and the numbers of young men being radicalised and coming to Syria and Iraq.

Out here the Kurds say they are right to be concerned.

"It is almost like super-terrorism and this is the frontline," Bafle Talabani, the British-born founder of the Kurds' elite Counter Terrorism Group, told me in the grounds of his father's house, which happens to be the Presidential Palace.

"It is more aggressive, more merciless more brutal. This is the front of the war on terror," he says.

"If we don't stop this here they will come for the West, for England, for Europe or the United States. They need to be stopped."

Bafle Talabani says IS represents a super-terrorism and needs to be stopped

IS, he believes, is the most dangerous single entity in the world today.

He is urging western governments to allow the Kurds to buy their own weapons or supply them.

"The special forces have good equipment. The peshmergas' weapons go back to the Iran-Iraq war. They are fighting against good weapons and a well-organised outfit with lots of money," he says.

With so many willing jihadists available IS is unlikely to miss this single bomber.

When he is treated and well, he will go to prison and rot there for the rest of his life.

He will be denied martyrdom. The Kurds want the foreign fighters to know that.

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Homeless Shooter Kills Two At Welfare Office

A homeless man suspected of shooting dead two people at a welfare office in New Zealand has been detained after a seven-hour manhunt.

A third person was seriously injured when a man opened fire inside the Work and Income New Zealand (WINZ) office in Ashburton before fleeing on a bike.

Police named the suspect as 48-year-old John Tully - who was interviewed by the local newspaper last month talking about his struggles with the benefit system and finding somewhere to live.

Tully is alleged to have entered WINZ at 10am (local time) wearing a black balaclava.

The shooting took place at 10am

Residents of the small town were warned to stay indoors before Tully was apprehended near a lake by a police dog unit at 5pm.

He was treated for minor dog bite injuries.

Superintendent Gary Knowles said: "Nothing will give the families that have lost their loved ones closure but the community can go to sleep tonight with the thought that the person who we believe may be responsible is in custody."

Police are still searching for the murder weapon - believed to be a sawn-off shotgun.

The manhunt lasted seven hours

The Ministry of Social Development confirmed all three victims worked for the agency but gave no further details.           

"We are all devastated by the deaths of two of our colleagues in the shocking attack," chief executive Brendan Boyle said.

Local media reported that both of the deceased were women.

The third victim was reported to be in a serious but stable condition in hospital.

In an interview last month, Tully told the Ashburton Guardian he previously worked in Australian mines but now lived in a tent after being unable to secure government-assisted accommodation.

Two people died and a third is in a serious condition after the shooting

He also wrote to the authorities about his struggles.

Lawmaker Winston Peters confirmed Tully emailed his political party on August 14 about the difficulty of finding a house.

"We replied immediately and also followed up," Mr Peters said. "However, the emails kept bouncing back."

New Zealand Prime Minister John Key offered his condolences to the victims and their families.

"There will be many questions to be asked and answered in the coming days about how this happened," said Mr Key.

"Every day New Zealanders get up in the morning to go to work, and their families expect them to return home. In this case that hasn't happened and my thoughts are with the loved ones."

Ashburton is home to about 18,000 people and is 90 kilometres (56 miles) southwest of Christchurch.

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Russia Warns Ukraine Troops To Pull Back

Ukrainian forces must pull back from areas of eastern Ukraine where they can harm civilian targets, Russia's foreign minister has warned.

Sergei Lavrov spoke amid reports of fierce fighting for Luhansk airport between Ukrainian troops and Russian tanks - the latest allegation of direct Russian involvement in the conflict.

Ukrainian forces have been ordered to pull back from the airport in the face of the onslaught, a military spokesman said.

Ukraine's Defence Minister Valeriy Geletey said that Russian units were moving into other towns in the region, including the largest city of the region Donetsk.

The attack on a Ukrainian vessel took place off the coast of Mariupol

"The information that Russian troops are there has been confirmed," he said.

"We are fighting Russia and it is Russia which is deciding what will happen in Donbass," he told Ukraine's Inter channel, referring to the informal name of the Donetsk and Lugansk regions.

Sergei Lavrov warned Ukraine to pull its forces back from areas in the east

Mr Lavrov again denied that Russian troops were in Ukraine and said he hoped talks taking place on Monday in the Belarussian capital Minsk today will focus on agreeing an immediate, unconditional ceasefire.

Speaking in the east Siberian city of Yakutsk on Monday, Russia's President Vladimir Putin accused Europe of ignoring the Ukrainian army "directly targeting its fire on residential areas".

He said he hoped "common sense will prevail" and that Russia and the West would not harm each other with further sanctions.

A rights group that works to expose Russian army abuses has claimed that up to 15,000 soldiers have been sent to Ukraine by Moscow in the last two months, and several hundred may have died in combat.

Valentina Melnikova, head of the Committee of Soldiers' Mothers, a prominent organisation representing the families of military servicemen, said that some 7,000-8,000 Russian troops are believed to be in Ukraine at present.

"Military commanders are conducting a secret special operation," said Melnikova, who is a member of the defence ministry's public council.

Satellite imagery reportedly shows Russian military vehicles inside Ukraine

Meanwhile, a Ukrainian military spokesman said a rescue operation was continuing for two seamen missing in the Azov Sea after pro-Russian separatists attacked a Ukrainian navy vessel for the first time.

Eight other seamen survived the attack and were being treated for wounds and burns after the vessel was hit by artillery from the shore.

Separatists in the region claimed responsibility for the attack on social media.

Writing on the site VKontake, former separatist military commander Igor Strelkov said: "The militia have dealt the enemy their first naval defeat."

Vladimir Putin's face has been used as a target at a Lviv shooting range

Although pro-Russian rebels have been fighting government forces since April, this is the first incident at sea.

Separatists have made significant gains in several towns close to the Azov Sea in recent days and are said to have set their sights on Mariupol. 

Ukraine's President Petro Poroshenko said the events of the past few days have shown that Russia has launched "a direct and open aggression" against Ukraine.

Leading American senators have called for the US to send weapons to help Ukraine defend itself against what they called "a Russian invasion".

Democrat Robert Mendez, who runs the Senate Foreign Relations Committee, told CNN: "We should provide the Ukrainians with the type of defensive weapons that will impose a cost upon Putin for further aggression."

The call was echoed by former Republican presidential candidate John McCain, who told CBS's Face the Nation that Mr Putin was "an old KGB colonel that wants to restore the Russian empire".

Earlier, the European Union gave Russia a week to scale back its intervention in Ukraine, warning of further sanctions.

China said it opposes additional sanctions against Russia and has urged world leaders to find a political solution to the crisis.

Mr Putin has consistently denied sending in troops, but has defiantly called for immediate talks on "statehood" for southern and eastern Ukraine.

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