The Kremlin on Wednesday renounced the right to send troops into Ukraine and voiced support for a peace plan, but the West said Russia must do much more to stop the fighting in eastern Ukraine if it wants to avoid a new, more crippling round of sanctions.
A cease-fire, already fragile, is set to expire Friday, the same day that Ukraine signs a pivotal economic agreement with the European Union and the day that the EU and U.S. may consider further punitive measures against Russia.
After months of upheaval, this much is clear: The West appears to accept that it can do nothing about Russia's annexation of Crimea, while Moscow seems resigned to Ukraine signing the sweeping trade pact that will bind the country more closely to the EU.
It was the former Ukrainian president's abrupt decision late last year to back out of the EU deal under pressure from Russia that triggered the current crisis.
But much uncertainty still surrounds the future of eastern Ukraine, where government troops are battling armed Moscow-backed separatists. The cease-fire has been repeatedly interrupted by fighting since it went into force last Friday.
At Putin's request, the Russian parliament rescinded a resolution that had empowered him to intervene militarily in Ukraine. Putin said his request was intended to support the peace process.
U.S. and European governments welcomed the step but said it was not enough.
"Now we believe it's critical for President Putin to prove by his actions, not just his words, that he is indeed fully committed to peace," U.S. Secretary of State John Kerry said at a meeting of diplomats from NATO nations in Brussels.
The same message was delivered by the German chancellor and the NATO chief.
Behind the scenes, meanwhile, the leaders of France, Germany and Ukraine spoke with Putin for more than an hour in a conference call.
The four agreed that a mechanism needs to be set up to oversee the cease-fire, German Chancellor Angela Merkel's spokesman said. A statement issued by French President Francois Hollande said he and Merkel encouraged Putin to work with Ukrainian President Petro Poroshenko to put such a mechanism in place.
The Kremlin said that Putin once again called for extending the cease-fire and sitting down for talks. Putin has argued that Ukraine's demand that the rebels lay down their weapons within a week was unrealistic because they fear reprisals.
The cease-fire is set to expire Friday morning. On Tuesday, however, Poroshenko warned that he may end the truce ahead of time after the rebels used a shoulder-fired missile to shoot down a Ukrainian military helicopter, killing nine servicemen.
In eastern Ukraine, residents said fighting raged as recently as Wednesday morning around the city of Slovyansk, where at least one woman died when a mortar bomb tore through the roof of her house. AP reporters who visited Slovyansk saw fresh damage from the fighting, and witnesses said that rebels fired on government positions just outside the city, drawing retaliatory fire that damaged some residential buildings.
Kerry listed the specific steps that the West expects Putin to take to show his commitment to peace: stop the flow of weapons and fighters from Russia to Ukraine, publicly call on the separatists to lay down their arms, withdraw Russian forces from the border and help secure the release of observers from the Organization for Security and Cooperation in Europe who have been held in eastern Ukraine for weeks.
"Until Russia fully makes that kind of commitment to the peace process and to the stability of Ukraine, the United States and Europe are compelled to continue to prepare greater costs, including tough economic sanctions, with the hope that they will not have to be used," Kerry said.
Merkel told lawmakers that the EU will do everything possible to find a diplomatic resolution, but "if nothing else helps, sanctions could return to the daily agenda."
Two previous rounds of U.S. and EU sanctions imposed asset freezes and travel bans on members of Putin's inner circle over Russia's annexation of Crimea. The next round, which would affect entire sectors of the Russian economy, could be far more crippling.
NATO Secretary-General Anders Fogh Rasmussen said after a meeting of NATO foreign ministers that they endorsed a package of measures to bolster Ukraine's military.
Alexei Arbatov, the head of the Center for International Security at the Russian Academy of Sciences, wrote in the daily Nezavisimaya Gazeta that the Ukrainian crisis can be resolved only through compromise, or else "the country will be torn into pieces with grave political and social consequences for Europe and the entire world."
Putin has called on Ukraine to adopt constitutional amendments and other legal changes that would protect the rights of Russian-speakers in the east. Poroshenko promised on Wednesday to propose amendments offering broader powers to the country's regions.
Vladimir Isachenkov in Moscow, John-Thor Dahlburg in Brussels, David Rising in Berlin and Greg Keller in Paris contributed to this report.