Russian President Vladimir Putin accused Ukraine's leaders on Thursday of committing a "grave crime" by using the army to try to quell unrest in the east of the country, and did not rule out sending in Russian troops.

But, addressing Russians in his annual televised phone-in, Putin said he hoped he would not need to take such a step, and that diplomacy could succeed in resolving the standoff.

Putin nevertheless said that trust between Russia and the United States had been damaged before the crisis in Ukraine, but that he wanted to restore their cooperation.