Move comes as US Congress approves financial aid to Kiev, sanctions on Russia; Moscow hikes gas price for Ukraine
April 1, 2014 8:02AM ET |Updated 7:11PM ET

NATO announced a suspension of "all practical civilian and military cooperation" with Russia on Tuesday, condemning the country's "illegal" intervention in Ukraine as Moscow turned the financial screws on Kiev by hiking the cost of gas.

In a strongly worded statement, NATO foreign ministers meeting in Brussels said the Russian takeover of Crimea represented a "violation of Ukraine's sovereignty and territorial integrity." The military alliance also announced plans to bolster ties with other former Soviet states in eastern Europe.

The move came just hours after Russia sharply increased the price of natural gas to Ukraine, threatening to reclaim billions of dollars in previous discounts and raising the heat on Kiev's cash-strapped government.

State-controlled natural gas giant Gazprom said the company had set the price at $385.50 per 1,000 cubic meters for the second quarter, and withdrew December's discount that put the price of gas at $268.50 per 1,000 cubic meters, according to the company's Chief Executive Officer Alexei Miller.

That discount was part of a financial lifeline which Russian President Vladimir Putin offered to Ukraine's then-president, Viktor Yanukovich, after his decision to spurn a pact with the European Union in favor of closer ties with Moscow. That decision fueled three months of protests which led eventually to Yanukovich fleeing to Russia in February.

Miller said Tuesday that the decision to charge a higher price in the second quarter was made because Ukraine has failed to pay off its debt for past supplies, which now stands at $1.7 billion.

On Monday, Russian President Vladimir Putin announced a partial withdrawal of troops from his country's border with eastern Ukraine. Russia had amassed nearly 40,000 troops along Ukraine's border a move that spurred fears that an invasion was imminent after Moscow annexed the Crimean peninsula earlier this year.

However, Putin and other officials have said that Russia has no intention of invading Ukraine. Russian Defense Minister Sergei Shoigu insisted Tuesday that the Kremlin wants a "political settlement that would take into account interests and rights of the entire Ukrainian people" and had no intention to threaten Ukraine's statehood.