Pro-Russian rebels pounded encircled Ukrainian government forces on Monday and Kiev said it would not pull back heavy guns while a truce was being violated, leaving a European-brokered peace deal on the verge of collapse.

The European Union kept pressure on Russia and the rebels by announcing a new list of separatists and Russians targeted with sanctions, to which Moscow promised an "adequate" response.

Fighting subsided in many parts of eastern Ukraine under a cease-fire that came into force on Sunday, under the deal reached last week in marathon talks involving the leaders of France, Germany, Russia and Ukraine.